Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
Boris Johnson Hits Coronavirus Panic Button Again, UK Accelertoing Covid-19 Second Wave - 25th Sep 20
Precious Metals Trading Range Doing It’s Job to Confound Bulls and Bears Alike - 25th Sep 20
Gold and Silver Are Still Locked and Loaded… Don't be Out of Ammo - 25th Sep 20
Throwing the golden baby out with the covid bath water - Gold Wins - 25th Sep 20
A Look at the Perilous Psychology of Financial Market Bubbles - 25th Sep 20
Corona Strikes Back In Europe. Will It Boost Gold? - 25th Sep 20
How to Boost the Value of Your Home - 25th Sep 20
Key Time For Stock Markets: Bears Step Up or V-Shaped Bounce - 24th Sep 20
Five ways to recover the day after a good workout - 24th Sep 20
Global Stock Markets Break Hard To The Downside – Watch Support Levels - 23rd Sep 20
Beware of These Faulty “Inflation Protected” Investments - 23rd Sep 20
What’s Behind Dollar USDX Breakout? - 23rd Sep 20
Still More Room To Stock Market Downside In The Coming Weeks - 23rd Sep 20
Platinum And Palladium Set To Surge As Gold Breaks Higher - 23rd Sep 20
Key Gold Ratios to Other Markets - 23rd Sep 20
Watch Before Upgrading / Buying RTX 3000, RDNA2 - CPU vs GPU Bottlenecks - 23rd Sep 20
Online Elliott Wave Markets Trading Course Worth $129 for FREE! - 22nd Sep 20
Gold Price Overboughtness Risk - 22nd Sep 20
Central Banking Cartel Promises ZIRP Until at Least 2023 - 22nd Sep 20
Stock Market Correction Approaching Initial Objective - 22nd Sep 20
Silver Bulls Will Be Handsomely Rewarded - 21st Sep 20
Fed Will Not Hike Rates For Years. Gold Should Like It - 21st Sep 20
US Financial Market Forecasts and Elliott Wave Analysis Resources - 21st Sep 20
How to Avoid Currency Exchange Risk during COVID - 21st Sep 20
Crude Oil – A Slight Move Higher Has Not Reversed The Bearish Trend - 20th Sep 20
Do This Instead Of Trying To Find The “Next Amazon” - 20th Sep 20
5 Significant Benefits of the MT4 Trading Platform for Forex Traders - 20th Sep 20
A Warning of Economic Collapse - 20th Sep 20
The Connection Between Stocks and the Economy is not What Most Investors Think - 19th Sep 20
A Virus So Deadly, The Government Has to Test You to See If You Have It - 19th Sep 20
Will Lagarde and Mnuchin Push Gold Higher? - 19th Sep 20
RTX 3080 Mania, Ebay Scalpers Crazy Prices £62,000 Trollers Insane Bids for a £649 GPU! - 19th Sep 20
A Greater Economic Depression For The 21st Century - 19th Sep 20
The United Floor in Stocks - 19th Sep 20
Mobile Gaming Market Trends And The Expected Future Developments - 19th Sep 20
The S&P 500 appears ready to correct, and that is a good thing - 18th Sep 20
It’s Go Time for Gold Price! Next Stop $2,250 - 18th Sep 20
Forget AMD RDNA2 and Buy Nvidia RTX 3080 FE GPU's NOW Before Price - 18th Sep 20
Best Back to School / University Black Face Masks Quick and Easy from Amazon - 18th Sep 20
3 Types of Loans to Buy an Existing Business - 18th Sep 20
How to tell Budgie Gender, Male or Female Sex for Young and Mature Parakeets - 18th Sep 20
Fasten Your Seatbelts Stock Market Make Or Break – Big Trends Ahead - 17th Sep 20
Peak Financialism And Post-Capitalist Economics - 17th Sep 20
Challenges of Working from Home - 17th Sep 20
Sheffield Heading for Coronavirus Lockdown as Covid Deaths Pass 432 - 17th Sep 20
What Does this Valuable Gold Miners Indicator Say Now? - 16th Sep 20
President Trump and Crimes Against Humanity - 16th Sep 20
Slow Economic Recovery from CoronaVirus Unlikely to Impede Strong Demand for Metals - 16th Sep 20
Why the Knives Are Out for Trump’s Fed Critic Judy Shelton - 16th Sep 20
Operation Moonshot: Get Ready for Millions of New COVAIDS Positives in the UK! - 16th Sep 20
Stock Market Approaching Correction Objective - 15th Sep 20
Look at This Big Reminder of Dot.com Stock Market Mania - 15th Sep 20
Three Key Principles for Successful Disruption Investors - 15th Sep 20
Billionaire Hedge Fund Manager Warns of 10% Inflation - 15th Sep 20
Gold Price Reaches $2,000 Amid Dollar Depreciation - 15th Sep 20
GLD, IAU Big Gold ETF Buying MIA - 14th Sep 20
Why Bill Gates Is Betting Millions on Synthetic Biology - 14th Sep 20
Stock Market SPY Expectations For The Rest Of September - 14th Sep 20
Gold Price Gann Angle Update - 14th Sep 20
Stock Market Recovery from the Sharp Correction Goes On - 14th Sep 20
Is this the End of Capitalism? - 13th Sep 20
The Silver Big Prize - 13th Sep 20
U.S. Shares Plunged. Is Gold Next? - 13th Sep 20
Why Are 7,500 Oil Barrels Floating on this London Lake? - 13th Sep 20
Sheffield 432 Covid-19 Deaths, Last City Centre Shop Before Next Lockdown - 13th Sep 20
Biden or Trump Will Keep The Money Spigots Open - 13th Sep 20
Gold And Silver Up, Down, Sideways, Up - 13th Sep 20

Market Oracle FREE Newsletter

How to Get Rich Investing in Stocks by Riding the Electron Wave

Gold Price Correction Separating the Men from the Boys

Commodities / Gold and Silver 2013 Feb 22, 2013 - 03:41 PM GMT

By: Profit_Confidential

Commodities

Is gold bullion becoming the commodity the mainstream media and analysts love to hate?

After all, views of the metal are becoming increasingly bearish. But I believe the most important factor as to why gold bullion is actually attractive at this point is being ignored; gold bullion becomes more valuable as the paper money created by central banks increases in circulation.


How negative have investors become on gold bullion? Since October 2012, hedge funds have cut their holdings of gold bullion by 56%. (Source: Bloomberg, February 15, 2013.) Hence, you can see why some are calling the recent price decline in gold bullion prices the end of the bull market in the metal.

Here’s a long-term chart of gold bullion prices. I see a sideways pattern developing, but I don’t see a bust of the bull market that started 12 years ago in gold bullion.

Chart courtesy of www.StockCharts.com

As my loyal readers know, I’m still bullish on gold bullion. My main reason for staying bullish is very simple; so long as the central banks continue to devalue their currencies, I believe the precious metal will shine.

And right now, wherever I look, I see central banks looking to “fight” their strengthening currencies by outright devaluing them. Their attitude of “do whatever it takes to get our exports going” is going to create trouble in the future.

The Federal Reserve alone has printed trillions of dollars to improve the economy. And unfortunately, other central banks are taking the exact same actions—not just major central banks, but the smaller ones too, like the Philippine, Taiwan, Indonesia, South Korea, Colombia, Peru, Costa Rica, and Brazil central banks.

Dear reader, what holds true is that the list of central banks committing to print more money is increasing, and those that were already printing are promising to print more. For example, the central bank of Switzerland, is working hard to keep the value of the Swiss franc lower so its currency doesn’t rise in value against the euro. (The eurozone is its major trading partner.)

As more central banks join in on printing more money, I become more bullish on gold bullion. Looking at the long-term picture, gold bullion is standing at a bright spot. Remember: No investment goes straight up or straight down. And in true bull markets, pullbacks are needed to weed out the speculators.

Michael’s Personal Notes:

A slight rise in U.S. home prices has the financial news reporters believing there is real growth in the U.S. housing market. Unfortunately, the fact is: the housing market in the U.S. economy hasn’t improved, and the most important aspect of real growth—first-time homebuyers—is still missing.

Consider this, if the price of a stock goes down by 30%, and then the next day it rises by 10%, would you say the stock has recovered? The answer is, “no.”

The S&P/Case-Shiller 20-City Home Price index, the most quoted index to observe the pulse of U.S. housing market, is still close to the same point it was at in August of 2010, and it’s down almost 30% since the end of 2006. (Source: Federal Reserve Bank of St. Louis, January 29, 2013.)

If you judge the housing market by looking at home prices, then clearly, it is deep underwater. Average home prices in the U.S. housing markets will have to increase more than 40% to get to the same level as 2006.

Now, if you look at the first-time homebuyers—the pulse of the housing market—they are not getting involved.

How bleak is the demand for first-time homebuyers in the U.S. housing market? At the very best, it is dismal.

Look at the sales of new one-family homes. They have been continuously declining. In 2011, on average, 168,000 units of new one-family homes were sold in the U.S. housing market. In 2012, the average was 146,000—a decline of more than 13% over a one-year period. (Source: Federal Reserve Bank of St. Louis, January 25, 2013.)

And according to the National Association of Home Builders/Wells Fargo Housing Index (HMI), the confidence of new single-family home builders is falling. It fell to 46 in February from 47 in January. (Source: National Association of Home Builders, February 19, 2013.) Any number below 50 means that the builders perceive housing market conditions to be poor, not good.

Keep in mind that new home builders closely follow the demand of the housing market. If their confidence turns negative, it is definitely not a good sign.

Dear reader, consumers in the U.S. economy are still working hard to make ends meet. After the financial crisis, those who were lucky enough to find a job are earning less than they did before, while others are still unemployed.

It is truly not a surprise for me to see the absence of first-time homebuyers from the housing market. They simply don’t have money right now to afford houses. I will consider the U.S. housing market to be in a rebound when I see first-time homebuyers pouring in—right now, that’s not the case.

NEWSFLASH: Highflier Toll Brothers, Inc. (NYSE/TOL), the largest U.S. luxury home builder, saw its stock fall by just under 10% on Wednesday after the company reported earnings that significantly trailed analysts’ estimates. My opinion: investors have pushed the stocks of new home builders up too far. The rebound in the housing market will be much slower than analysts and investors currently predict.

Where the Market Stands; Where it’s Headed:

My indicators point to the stock market being severely overbought. I don’t think stocks have much more room to move higher, and I continue to believe we are getting close to a top for the market.

What He Said:

“I see a deal when it’s a deal. And right now there’s a good ‘for sale’ sign flashing on gold bullion and gold producer shares. In fact, after peaking at the $690 an ounce level earlier this year, gold could be a bargain at its current price of around $650 per ounce. As a reader, you are undoubtedly aware of my negative stance on the general stock market and the U.S. economy. As the economic problems that continue to brew in the U.S., as these problems develop into others, and as they are finally exposed, what other investment but gold will worldwide investors turn to?” Michael Lombardi in PROFIT CONFIDENTIAL, March 14, 2007. Gold bullion was trading under $300.00 an ounce when Michael first started recommending gold-related investments.

Source - http://www.profitconfidential.com/gold-investments/golds-price-correcti...


By Mitchell Clark, B.Comm. for Profit Confidential

http://www.profitconfidential.com

We publish Profit Confidential daily for our Lombardi Financial customers because we believe many of those reporting today’s financial news simply don’t know what they are telling you! Reporters are trained to tell you the news—not what it can mean for you! What you read in the popular news services, be it the daily newspapers, on the internet or TV, is the news from a “reporter’s opinion.” And there’s the big difference.

With Profit Confidential you are receiving the news with the opinions, commentaries and interpretations of seasoned financial analysts and economists. We analyze the actions of the stock market, precious metals, interest rates, real estate and other investments so we can tell you what we believe today’s financial news will mean for you tomorrow!

© 2013 Copyright Profit Confidential - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 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

6 Critical Money Making Rules