Gold

Long view of gold looks to have reached a support trendline with major pivot points in 2005, 2008 & now. From the chart its clear when the QE induced gold bubble started & popped.Image

Advertisements

Wilmar

Wilmar’s long term chart seems to have found some support between its 23.6% & 38.2% fib extension. Assuming the solar maximum is next year as predicted, soft commodities like soybean & wheat should peak around then as well, which is margin positive for integrated crushers like Wilmar in an anemic global economy. Others such as ADM & Bunge should benefit from the upcoming soft commodity bear market as well.

Further reading: Aurora Borealis & global surface temperature study, Sun headed into hibernation. Ani-thesis: Global warming myths. Regardless of how food prices are moved, let the charts do the talking.

Mid term resistance/support is 3.50/3.00.

Wilmar101212

Gold update

Goldman Sach’s new targets for gold are 2013: 1800/oz & 2014: 1750/oz, citing growing risks. I wrote the following in my previous post:

“…gold…being driven by the fear of a big future plunge in fiat currency values & declining cash purchasing power.”

“There’s a fair chance that this fear could be overdone…”

“Im a gradual buyer at 1550..”

I’m therefore sticking to my buying target of about 1550/oz & am glad that a big investment bank generally agrees with my view.

 

Gold

Gold has had an extraordinary 400% run since bottoming around year 2000, when the then Fed Chairman Alan Greenspan embarked on the cheap debt expansion policy. It hit a speed bump in 2008 but has risen dramatically since then. Some may argue from a technical view that its chart since early 1990s looks like the left side of an Eiffel Tower structure & the right side may play out, but fundamentally its being driven by the fear of a big future plunge in fiat currency values & declining cash purchasing power.

There’s a fair chance that this fear could be overdone as it will take years if not decades for another asset to replace the US dollar & its Treasuries as a safe haven simply because there isn’t enough gold circulating globally unlike US dollars.

Its chart has been creating a rising trend, with a monthly support seen at 1550 & resistance of 1900. Short term support is about 1700 & resistance is 1790. Intermediate term, a bullish pennant continuation maybe forming.

Im a gradual buyer at 1550, with a view that if next year is bearish as per the SNP500 triple top playing out, it could fall back to about 1280-1330 at its 38.2% fib retracement. Upside target is 2000 for now.