Gold 2024: How low can it go?

[SeverinDigsSovereigns]

13 minutes ago, RDHC said:

That simply shows how little the CIA knew about economics. More informed estimates since then put the size of the late Soviet economy at about 1/5 of the equivalent American one. This was tacitly acknowledged by Gorbachev, an intelligent man, who realised that it would be impossible to match the colossal expense of Reagan's projected 'Star Wars' missile shield, so he began the process of 'perestroika', which quite quickly led to the unravelling of the USSR or the 'evil empire' as Reagan accurately termed it. 

You could chuck all your money and resources into a few Tsar Bombas and still have high GDP, because GDP measures transaction. It's just that your country won't last too long this way...

Also, Russia still has quite purchasing power today because labour is cheap. A crude comparison between GDP per capita and PPP per capita shows the picture roughly. By fixing GDP/PPP at 1 for USA the UK is at 1.1 ish, while Australia at around 0.9 (Australia is an expensive country!). For Russia that's well over 2. This reduces the influence of FX rates as well.

Edited January 2 by SeverinDigsSovereigns

[RoughDog]

Don't know how low it will go but there seems to be no ceiling.

Seems it's forever steadily climbing.  Its not a case of if £1700 or if £2000 but when.

I is hoping for £1500 too.

 

[JohnA1]

 

[Bumble]

For what it's worth, I'm pretty optimistic about gold in the coming year. Also bitcoin. I'm very bearish GBP. It's nice to be able to get 4% to 5% interest in a savings account, but right now I wouldn't want that savings account to be denominated in GBP.

[Bigmarc]

48 minutes ago, JohnA1 said:

 

Can't believe that vid has had half a million views.

[JohnA1]

21 minutes ago, Bigmarc said:

Can't believe that vid has had half a million views.

You're right, I hadn't noticed. Goes to show how made-up the 'views' figures are on youtube..

Same tehnology that sets the PM prices?

Probably similar to the tech we used to walk on the moon 50 years ago😅

Edited January 2 by JohnA1

[Shinus73]

7 hours ago, JohnA1 said:

Hell no, not all the time, the fluctuations are significant, only on a long-term basis

With the current 'price' hanky-panky the definition of "long term" could be decades 😄

 

Adusted for real CPI, gold is currently almost 9x lower than where it was 1980. Silver25x.

When that spring is unloaded, it's gonna hurt

 

 

The silver spring unloaded in 2010 / 2011 and you had about 5 minutes to sell before it loaded again. Of course, at the time, most were panic buying because it was going to triple digits….

[Kitalon]

On 01/01/2024 at 14:18, katyc said:

 this (link below) explains the dollar cost averaging concept and I'm pretty sure will make you want to buy some gold without delay.

Thank you, I think I understand the cost averaging concept a lot better now. Listening to everyone here has definitely changed the way I'm thinking now. But it still doesn't make me want to buy without delay, I want to be more like Harry carefully choose my moments and end up half a million richer than Amanda. 😜

[Bigmarc]

4 minutes ago, Kitalon said:

Thank you, I think I understand the cost averaging concept a lot better now. Listening to everyone here has definitely changed the way I'm thinking now. But it still doesn't make me want to buy without delay, I want to be more like Harry carefully choose my moments and end up half a million richer than Amanda. 😜

Stick to your gut instinct it rarely lets you down. Besides how old is harry if he has been putting £500 a month for 50 years. 

[SeverinDigsSovereigns]

12 minutes ago, Kitalon said:

Thank you, I think I understand the cost averaging concept a lot better now. Listening to everyone here has definitely changed the way I'm thinking now. But it still doesn't make me want to buy without delay, I want to be more like Harry carefully choose my moments and end up half a million richer than Amanda. 😜

$500 each month was big money in the 70s and 80s. If you could afford $500/mo back in the 70s and have not gone broke in 92, 97, 08, etc, you will either have

1) quit gold completely

2) raised your stakes massively to something like $5000/mo

3) become a collector spending tens of thousands on single coins, f (short for foget) bullion

[katyc]

1 hour ago, Kitalon said:

But it still doesn't make me want to buy without delay, I want to be more like Harry carefully choose my moments and end up half a million richer than Amanda. 😜

Haha, fair enough! But timing the market rarely works out even for the best investors. And I think waiting for the right time can mean missing opportunity as well as adds stress and time/analysis which is why going forward "set it and forget it" is my strategy.

The numbers are a bit silly in the example (e.g. who could save $500 a month in the 70s?!) but it's useful to understand the concept.

[katyc]

Good luck @Kitalon in whatever you decide. Please keep us posted in your decision. Would be interesting to see how it goes.

Edited January 4 by katyc

[CowPat]

Gold price is a tricky one to predict. If it was to drop from here there are a couple of price levels that I would look out for. The first is $1615 (the low of 10/22) and if that doesn't hold then my guess would be a ABC correction down to test the top of the 06/13-06/19 range. That would be a price around the $1350 mark. With the DJI forming a blow off top, its seems likely that a big crash is coming in the stock market and will be interesting to see how gold will react to that. The last time the DJI formed this structure the price of gold was fixed, so we are in new territory. 

My best guess is that gold will drop, but not by a huge amount. Then we will see a multi-year bull market for gold. From the bottom of the gold price at the time of the 08 GFC to the top of the market (08/11) gold went up by 180%. I will have a bit of that action!  

Edited January 4 by CowPat

[Bigmarc]

18 hours ago, Kitalon said:

I want to be more like Harry carefully choose my moments and end up half a million richer than Amanda

I had some time at work today and thought I would do some research. This may help you visualise it a little better. 

I went back 50 months on the for sale section of the forum. I picked a random bullion sovereign in the middle of each month (one carded and one blister as slim pickings some months). I also filtered it to individual sellers. Also I added 50 special delivery postage cost. Here is the list. 

So over 50 months a total of £17938 would have been spent, this is a cost average of £358.76 per sovereign and would have 50 sovereigns

If you belly flopped in 50 months a go you would have 67 sovereigns for the same cost. 

The beginning of 2021 and 2022 with the same value you would have 54 sovereigns.

And 2024 you would only have 46 sovereigns with the same value spent. 

Considering you can't beat the pound cost average price in the last two years I must admit it does look a better option for the long term. Me personally I am not a cost averager as I like to do many things elsewhere. 

 

 

 

 

[Kitalon]

Thank you for this. It's very useful and something I have been wanting to know about for a while (well since I started researching buying bullion over the last couple of months that is). You're a mind-reader! 😄 I have often wondered what the costs of sovereigns looks like over the past few years. It also highlights why I feel like I'm late to the party and wish I'd known about sovereigns 3 or 4 years ago. It's never going to be that good again and it's only going to get worse for those of us starting out.

At the moment I'm enjoying the thrill of trying to calculate and pick my moment to buy in, then I can just forget about it for a decade or 3 and get on with the rest of my life - rather than spending weeks, months and years slowly hoarding gold at an ever increasing rate. Doing a belly flop 🤣 as you put it works out 4oz better off than any cost averaging shenanigans. Maybe it doesn't make much financial sense but I do feel like saving on the hassle and postage and just buying 50 sovereigns tomorrow, or 48 1/4oz britannias = 12 Oz, because I like nice round figures, bury it in the ground and dig it up in 30 years time.

I wonder how much a sov or 1/4 brit would be worth in 2054? 🤔 1oz bullion would probably be far too expensive to easily liquidate by then.

Edited January 5 by Kitalon

[Chronos]

4 hours ago, CowPat said:

Gold price is a tricky one to predict.

Not really. To the Moon!

Edited January 4 by Chronos

[Chronos]

16 minutes ago, Kitalon said:

I do feel like saving on the hassle and postage and just buying 50 sovereigns tomorrow, or 48 1/4oz britannias = 12 Oz, because I like nice round figures, bury it in the ground and dig it up in 30 years time.

Could you not mention any numbers next time you are going to talk about buying gold? Because seeing how much money you have makes me sad and depressed and then I just want to crawl in a corner and weep ...

Edited January 4 by Chronos

[CowPat]

12 minutes ago, Chronos said:

Not really. To the Moon!

Here's a completely accurate chart for you. 

[JohnA1]

1 hour ago, Kitalon said:

...I wonder how much a sov or 1/4 brit would be worth in 2054? 🤔

In what currency?

The current ones are at the very end of their cycle, having been totally free from any gold link in the past few decades

 

Remember a member of the public could exchange a paper GBP for a sovereign at any commercial bank until 1913 or so

Under certain (strict) conditions it could still be exchanged until 1931

Edited January 4 by JohnA1

[Kitalon]

1 hour ago, Chronos said:

Could you not mention any numbers next time you are going to talk about buying gold? Because seeing how much money you have makes me sad and depressed and then I just want to crawl in a corner and weep ...

Don't be sad I'm just waxing lyrical and speaking metaphorically. I'm not going to disclose how much money I do/do not have on a public forum. This is a work of fiction. Any similarity to actual persons, living or dead, or actual events, is purely coincidental.

39 minutes ago, JohnA1 said:

In what currency?

The current ones are at the very end of their cycle, having been totally free from any gold link in the past few decades

I would ask you what you mean but I fear that the answer would be to hard for me to comprehend and hurt my head. So I will only say 'all of them' as the gold rate performance against all currencies appears to be mostly the same when put side by side. 😉

[JohnA1]

1 hour ago, Kitalon said:

I would ask you what you mean but I fear that the answer would be to hard for me to comprehend and hurt my head. So I will only say 'all of them' as the gold rate performance against all currencies appears to be mostly the same when put side by side. 😉

In 2054 none of the existing currencies will be around. Not in the current form anyway. They are all being inflated away at an accelerating rate, reaching the end of their lifecycle. This has been repeated many times before with all fiat currencies (without fixed link to gold)

Have a look at a picture of a 100 trillion dollar banknote I have posted somewhere here from 2008 Zimbambue (got it from ebay). That dollar started at parity with US dollar, now it is worthless. Zimbambue is a rich (but fiercly corrupt) country.

Same with USD, GBP and EURO. They will be a thing of the past in a few years, once prices start doubling every few months, the game is over. We are not very far from that point, and they'll probably pull the plug before we get there.

[Kitalon]

On 02/01/2024 at 14:19, HonestMoneyGoldSilver said:

3) Nobody has talked about running a balanced portfolio. If you are considering putting more than 25% of your investment funds into precious metals you better have good reasons for doing so

Thank you for this insight, I admit that I hadn't even looked at it in terms of percentages of wealth allocation. It makes a great deal of sense to portion off say 25%  into gold from property/savings/investments and sounds like good money management. I will definitely adopt this into my strategy going forward.

On 02/01/2024 at 14:19, HonestMoneyGoldSilver said:

Apart from investing your money, I would also advocate paying off debts. Paying off your mortgage, credit cards, car loans, student loans

Thankfully I have none of these except a mortgage (which I do seriously need to review) and no dependencies so my outgoings are low. If I wasn't in this situation, again I wouldn't even begin to contemplate buying gold.

After much further consideration I now feel less inclined to go all in on a low now. I will set myself a a target and most probably save and spread costs out not so much on a strict monthly basis but as the market dictates (i.e. when it is lower) to average out costs and prevent from making a costly mistake of buying in at the wrong time. As people here have said it's hard to predict. I'm in no particular rush and can still wait for the opportune moments over the next couple of years as and when they occur.

Edited January 7 by Kitalon

[Coverte]

I started buying gold over 20 years ago but have only charted value for 20 years.

In that 20 years, gold has had an average increase of over 9% - that's more than any other global index I follow.

Given that fact, I don't feel the need to study it any deeper other than buying dips; although IMHO any 2024 dip will be very modest when compared to 2023 fluctuations - but I've been wrong before.............

[MonkeysUncle]

On 03/01/2024 at 23:11, Bigmarc said:

Stick to your gut instinct it rarely lets you down. Besides how old is harry if he has been putting £500 a month for 50 years. 

Nay mind how old, where's he at? Worth robbing! 🤣

[Abyss]

Are we sharing charts, please sir can I share my charts? I have the 1 hour chart of Gold as part of my list of instruments that I pay attention to all the time. Sometimes I go into the higher time frames only to reinforce my belief that Gold has a lot higher to go over the next 2-10 years. My current long term analysis (looking at the monthly chart) broke above all time high $2080 was rejected. Have three months downside potential (end of March 2024) then if these monthly candles have not broken below $1820 then we could have another attempt and breaking and clearing the all time high in which case my price target would be $2800 in the next two years (measured move from the impulse up). We could also have another attempt at the all time high and fail in which result prices moving between $1660 to 1760 over the course of the year. Establish support at these level then my price target would be $2575 but would take more time to achieve (5 years). This is the problem with technical analysis is that the data is always changing and your analysis has to change with it. Have a constantly moving target both at the price and time axis. I personally would love lots of turns and twists testing this level and that level on the hourly chart.

I am telling you it is impossible to predict with accuracy the long time chart of any financial instrument. The Gold chart is showing you it has lots of upside potential and as a result I will be holding onto my physical gold (for investment, safety, peace of mind it provides) into the long term. I want to see likes of CNBC, CNN, BBC talk about Gold hitting $3,000, visit my local hairdressers and hear the conversation that he bought some gold and so has some of his patrons. I will then know it is time to sell my physical Gold and move into other assets.