Best of the Week
Most Popular
1.UK House Prices BrExit Crash NOT Likely Despite London Property Market Weakness - Nadeem_Walayat
2.BrExit Morning - New Dawn for Britain, Independence Day! - Nadeem_Walayat
3.LEAVE Wins EU Referendum - Sterling and FTSE Hit Hard, Pollsters, Bookies and Markets All WRONG! - Nadeem_Walayat
4.BrExit Implications for UK Stock Market, Sterling GBP, House Prices and UK Politics... - Nadeem_Walayat
5.Trading BrExit - Stocks, Bonds, Sterling, Opinion Polls, Bookmaker Odds and My Forecast - Nadeem_Walayat
6.FTSE and Sterling Brexit Trading, Deconstruction of the EU Referendum Result - Nadeem_Walayat
7.UK Interest Rate Cut to 0.25% Imminent and More QE Money Printing - Nadeem_Walayat
8.Trading BrExit - British Pound Plunges, FTSE Stock Futures Slump on LEAVE Shock Referendum Win - Nadeem_Walayat
9.The Stock Market is Reading it Wrong! - Chris_Vermeulen
10.Breakouts Galore in Gold and Silver - Jordan_Roy_Byrne
Free Silver
Last 7 days
Soybean Commodity Price to Soar Again - 23rd July 16
SPX Stock Market Uptrend Continues - 23rd July 16
Gold And Silver – Debt Addiction Will Carry Precious Metals Higher, Guaranteed - 23rd July 16
Pokemon Go - How to Play, First Use, Balls, Stops, Catching Pokemon's... Great Excercise! - 23rd July 16
7 Signs That the Gold Market Remains Resilient - 23rd July 16
Basic Income in The Time of Crisis - 23rd July 16
Silver Bull Faces Correction - 22nd July 16
The Serious Warning No One’s Talking About - 22nd July 16
Stock Market Insight from Greed, Volatility, and Put/Call Ratio - 22nd July 16
What Will Happen To the Stock Market When Interest Rates Rise? - 22nd July 16
How to Escape the World’s Biggest Ponzi Scheme - 22nd July 16
Addicted to Debt - We Can’t Borrow from the Future Anymore - 21st July 16
Not Everything Is Bullish for Gold - 21st July 16
Don’t Get Sucked Back Into the Stock Market - The Big Picture Hasn’t Changed - 21st July 16
Silver – Caught Inside - 21st July 16
Forex: "The Markets Are Getting Exciting!" - 20th July 16
China Economic Troubles - Is Kyle Bass Finally Getting His Revenge? - 20th July 16
Why Lithium Will See Another Price Spike This Fall - 20th July 16
The Peak Oil Paradox Revisited - 19th July 16
SPX Challenges the Upper Trendline - 19th July 16
Missing ’28 Pages’ of the 9/11 Report Released into Blitzkrieg of World Events - 19th July 16
Likelihood of Organized Disruption at GOP Convention - 19th July 16
More on the ‘Breadth Thrust’ and Stock Market Internals - 19th July 16
FX Traders: Get a Free Week of Forecasts (Details inside) - 19th July 16
Ups and Downs in Gold and Crude Oil Price - 19th July 16
Keep an Eye on ‘Bitcoin’ as the Next ‘Financial Crisis’ Starts! - 18th July 16
Erdogan Might Have Known about the Coup but Didn’t Prevent It on Purpose - 18th July 16
More Deflation Ahead: Silver, Gold And Their Mining Stocks A Must-Have - 18th July 16
Stock Market Minor Top? - 18th July 16
5 Best Gold and Silver Junior Mining Stocks in 2016 - 17th July 16
Gold And Silver – NWO-Created Tragedies Will Never End, Seek Truth - 16th July 16
How Long Can Buybacks Continue To Support A Market Which Is Standing On A Fundamentally Flawed Premise? - 16th July 16
Will They Come For Your IRA? - 15th July 16
Gold’s Record Selling Overhang - 15th July 16
Capitalism Has Entered a New Era—and Historic Stock Market Investing Returns Are Gone Forever - 15th July 16
Gold Price Could Hit $5,000 or Even $10,000 in a Few Years - 15th July 16
Junior Gold and Silver Mining Funds or Individual Gold and Silver Mining Stocks - 15th July 16
The Soaring Risk of Flying in Bernanke's Helicopter - 15th July 16
The Broad Stock Market, Helicopters and Gold - 15th July 16
The Curious Case of Vanishing Lady Liberty; Only Gold and Silver Remember Her - 15th July 16

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

Forex Forecasts

7 Market Predictions for 2016: Gold, Energy, Stocks, Bitcoin

Stock-Markets / Financial Markets 2016 Jan 02, 2016 - 01:37 PM GMT

By: Jason_Hamlin

Stock-Markets

Despite my hesitation in writing another piece like this, people seem to love prediction articles. It used to be an easier task to simply identify and go with the trends, but so much is now up to the whims of central planners that it is nearly impossible to have much accuracy. These are just my best guesses and I will make sure to revisit them in another 12 months to see how well they held up. Here are my seven predictions for 2016:


#1) The stock market corrects sharply from overbought levels, driven partly by increasing interest rates. The S&P 500 will drop by 25% or more during 2016 as a global recession unfolds. Economic data shows patterns similar to what was witnessed right before the last recession. The FED has little wiggle room to prop it up like they did last time around, but may be forced to reverse course on rates and introduce a new stimulus program by year end.

#2) The USD continues to strengthen versus other currencies, as the FED raises rates and other central banks continue to cut their rates. Our fractional reserve fiat monetary system is a great scourge on the world in my view. It enriches the few at the expense of the many and must be enforced at the barrel of a gun. We will likely see an increased trend of de-dollarization during 2016, particularly as the BRICS nations move away from using the USD in trade. Nevertheless, the USD remains the best of the fiat currencies and it will likely benefit from its perception as a safe haven when investors begin to flee stocks en masse.

#3) The unemployment rate reverses course and moves higher during 2016. The official unemployment rate (U3) has been cut in half since the financial crisis unfolded in 2008. It spiked to 10% during 2009, but has since dropped to just 5% in late 2015. Of course, a large portion of this decline was driven by a lower participation rate, sacrificing quality for quantity, more part-time jobs and BLS manipulation of data to brighten the overall jobs landscape. Alternative calculations of true unemployment remain near all-time highs around 24%. In 2016, the U3 unemployment number will stop falling and eventually begin to move higher for the first time in years.

#4) Home prices flatline and begin to trend lower during the second half of the year. Home prices have put in an impressive rebound over the past five years, but the rally is losing steam. During 2016, I expect a continuation of modest price gains in the first half of the year, then flatlining price growth and an eventual drop in home prices by the end of the year. This trend will be driven by rising interest rates that make homes less affordable, an increasing supply of new homes hitting the market and another peak in the median home price/median income ratio.

#5) Gold will finally carve out a base and bottom in the $950 to $1,050 range. The gold price will show a high level of volatility and ultimately close out 2016 with a gain of 20% or more. The silver price will follow gold, with a higher level of volatility in both directions. Precious metals will likely get dragged down initially in any economic crisis, but the monetary will bounce back quickly and re-assert themselves as true safe haven assets. With such a small level of investor participation in gold and silver currently, it will not take much a shift of funds into this relatively tiny market to move the prices significantly higher.

#6) Energy prices will continue to dip in the first half of 2016, but will eventually find a bottom and trend higher. The price of oil will test $30/barrel and dip as low as $25/barrel, but will bounce sharply and end the year closer to $50/barrel.

#7) The price of bitcoin will rocket to a new high above $1,200 during 2016. Bitcoin will gain greater acceptance in the mainstream financial world and the blockchain technology will flourish as it finds a variety of new uses. As the global recession intensifies and currency wars continue, people around the world will turn to bitcoin as a means of protecting their wealth and transferring it across borders.

#Bonus Predictions: Increased tensions with Russia in the Middle East, thousands of U.S. boots on the ground, ISIS is effectively wiped out, an assassination attempt on Donald Trump, Bernie Sanders giving Clinton a close race for the Democratic nomination, more domestic terrorism and mass shootings in the election year, executive action by Obama to increase gun control, unusual weather patterns causing a spike in natural disasters, a big earthquake hits California, Golden State beats the Cavs in the NBA finals, marijuana legalization sweeps the nation.

We will be positioning the Gold Stock Bull portfolio to take advantage of these trends in 2016. If you aren’t already a premium member, you can sign up here to receive the newsletter, model portfolio and trade alerts. Enter the coupon code 2016GO for 20% OFF any membership if you sign up today. Happy new year!

By Jason Hamlin

http://www.goldstockbull.com/

Jason Hamlin is the founder of Gold Stock Bull and publishes a monthly contrarian newsletter that contains in-depth research into the markets with a focus on finding undervalued gold and silver mining companies. The Premium Membership includes the newsletter, real-time access to the model portfolio and email trade alerts whenever Jason is buying or selling. Click here for instant access!

Copyright © 2015 Gold Stock Bull - All Rights Reserved

All ideas, opinions, and/or forecasts, expressed or implied herein, are for informational purposes only and should not be construed as a recommendation to invest, trade, and/or speculate in the markets. Any investments, trades, and/or speculations made in light of the ideas, opinions, and/or forecasts, expressed or implied herein, are committed at your own risk, financial or otherwise. The information on this site has been prepared without regard to any particular investor’s investment objectives, financial situation, and needs. Accordingly, investors should not act on any information on this site without obtaining specific advice from their financial advisor. Past performance is no guarantee of future results.


© 2005-2016 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife