In the past investors were limited in choices between paper assets like stocks , bonds and trust deeds, and physical assets. Physical assets were all forms of commodities (DBC, quote) , real estate, precious metals, agricultural, energies etc , along of course their labor.
Regular readers of my market analysis will know that I have been bearish on gold for some time, and despite the recent bullish trend which has seen gold move from the lows of $1170 per ounce to the high of late January at $1310 per ounce, have remained so.
For speculative traders, the last few weeks have offered wonderful trading opportunities across all markets, and provided you have no directional bias, the opportunities are there in abundance.
As we come to the end of 2014 and look forward to 2015, for those trading and investing in gold the perspectives and conclusions will no doubt be very different and entirely dependent on whether you are a longer term investor in the precious metal, or a short term speculator.
To say the last few days have been a roller coaster ride for commodities would be an understatement, with both oil and gold providing some sensational trading opportunities, but for very different reasons. For gold, it was the Swiss referendum over the weekend, and for oil, it was the OPEC meeting in Vienna.
The price action for gold throughout much of November could best be described as chaotic, with volatile days of price action subsequently followed by periods of relative inactivity, only to be replaced with extreme and unpredictable swings intraday. And perhaps the place to start with any analysis for the precious metal is on the weekly chart, for a more considered view of the price action.
An unnamed senior India ministry has indicated that India is likely to announce procedures to reduce gold imports as early as today.
For equity bulls, the nightmare is over for now. For gold and silver bugs it’s just beginning. If yesterday’s price action was concerning, the overnight news from Japan has opened the trap door for both metals, which has seen them plunge in early trading, as the Bank of Japan sent shock waves through the market announcing an acceleration of its bond buying program.
Yesterday’s trading session for commodities was an interesting one to say the least, with oil prices slumping, gold prices whipsawing, and silver prices breaking lower with momentum, as the bears continue to maintain a vice like grip on the market.
For gold bugs, yesterday’s gold trading session was another of those which promised much but delivered little, as the precious metal attempted to rally early in the session, before the weight of selling pressure overwhelmed the beleaguered bulls once more. The pattern for gold is now becoming remorseless and repetitive, with bearish sentiment now dominating, and as each rally comes and goes, the metal moves ever lower on the longer
