Betting On Gold?

If you are betting on gold, you may be in for some tough sledding. Below is a 5-year chart of the yellow metal updated through Sep 3, 2021…

The final posted price as of September 3rd is $1831 oz.

The Labor Day weekend gave gold investors three days to prime themselves for the anticipated price launch. Then, Tuesday happened.

By the end of the day, Sep 7th, gold was down more than $30 oz. and had reversed all of its gains from Friday September 3rd and more. The spot price closed below $1800 oz. for the first time in over one month.

It was a decidedly harsh jolt to anyone expecting a follow through from last Friday’s action and the potential implications are disturbing. Below is another chart. This one is a ten-day chart for GLD…

he chart above is admittedly very short-term in nature, but it is clear that Tuesday’s break in the gold price was swift and consequential.

Some additional perspective might help. Looking back at the first chart, it appears that the gold price has now broken below a clearly defined uptrend line of support dating back to 2018.

A possible near-term target for a move downward is $1500 oz. and there doesn’t appear to be much support before that.

After that there is considerable previous price action between $1300 and $1500 oz., so gold might find a stopping point somewhere within that range.

It is not unreasonable to expect this before the end of this year.

Kelsey Williams is the author of two books: INFLATION, WHAT IT IS, WHAT IT ISN’T, AND WHO’S RESPONSIBLE FOR IT and ALL HAIL THE FED!

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