My last update on gold, which I wrote toward the end of November, was titled “Why You Do NOT Want to Invest in Gold Now.” At the time, I was bullish on gold long-term, but issued this warning because all of my charts, indicators and oscillators showed gold and gold stocks at extremely overbought levels.
Gold did sell off in December, managing to work off all those frothy levels, but we have now entered the second leg of the mega rally in gold that will last for all of 2010 and into 2011.
Keep in mind that this is my longer-term view on the sector, as opposed to my typical short- to medium-term updates, which you have seen throughout 2009.
Your Second Chance in the Gold Sector
If you missed the gold run in 2009, then do yourself a favor and join the party in 2010. Don’t miss this next run up, because the profits to be had in this sector next year will blow 2009 away.
As I’ve stated before, gold has risen for nine straight years without a single year of negative returns. (Do you know of another asset class that can make that claim?) And next year will be no different. And gold is not, I repeat NOT, a U.S. dollar story. Gold isn’t rising in the dollar alone. It’s hitting new highs in every currency around the globe. And not all the world’s currencies experienced a complete freefall like the greenback.
The daily chart of gold below shows a symmetrical triangle breakout and parabolic run up that I brought to your attention in August.
From the weekly chart below, you can see that gold prices broke out of an ascending triangle as I predicted in that August update.
The chart continues to show a target of around $1,350 to $1,400 in the first quarter of 2010.
Finally, we have the monthly chart. Longer-term, gold is in a parabolic run, and my target for this pattern is a move to at least $1,800 to $2,000 in the second half of 2010 to the first half of 2011.
Stayed tuned, because in the very near future I will be bringing you the best gold stocks to own for this monstrous run up.
