Gold as a commodity or as a precious metal has rarely lost its charm, but there was a time when it was languishing at levels of around $255 to $290 for many years, and was considered an investment with mediocre returns. It faced stiff resistances at levels of $290-300, then at $400 and always kept testing this band and ceiling, and retracing, despite a perpetual shortage of supply from its primary source in Africa.
This situation has corrected itself significantly when gold broke this resistance level of $400 in earlier 2002, and prices have shot up by an astounding 250% over a period of five years to about $625-$650 an ounce! This dramatic move began when gold broke its resistance at $300 bucks and hasn't fall back again to that level since. As a matter of fact, gold hit a low of $300.65 over the following ten years. It stayed within the range between $300 and $400, hovering around its 200 day moving averages for quite some time, disheartening many traders and investors by price movements up and down, but around the moving averages.
It showed strength when it broke key resistances as well as its 200-day moving average on higher volumes in July 2004 to move past $400. It gained momentum, and began to show break-out signals sometime in October 2005. Prices hit $500 in December, where a lot of people booked profits, and this allowed the price to steady for a month or so. 2006 saw a near vertical rise for gold on very high volumes, with gold hitting $700 and then making a high of $725.75 in May 2006, just before the liquidity crisis hit world markets.
A long correction followed, which was inevitable after such a steep and swift rise, and gold retraced to 50% of it rise. This fall was steady, and prices moved down to $575 levels till October 2006. It is here that they stabilized and then continued its bull run to a point where gold now trades at $1500-$1650 levels in the past twelve months.
Buyers faced many worldwide issues throughout this time, because the U.S. was coping with the Iraq concern, Israel invaded Lebanon, North Koreans fired rockets too being a nuclear bomb, and making use of a nuclear confrontation with Iran and the European sovereigns debt crisis. With potential calamities facing the world, gold did actually effectively and served its role like a safe haven for investors. Despite all this, looking from year to year, gold continues being significantly higher.
Gold bullion and gold coins now seems to be getting ready for another long-term secular bull market. Whichever way you see it, gold has a good run in the past ten years, and it is currently consolidating , ready for the next bull run to head for newer highs in the next few years.
This situation has corrected itself significantly when gold broke this resistance level of $400 in earlier 2002, and prices have shot up by an astounding 250% over a period of five years to about $625-$650 an ounce! This dramatic move began when gold broke its resistance at $300 bucks and hasn't fall back again to that level since. As a matter of fact, gold hit a low of $300.65 over the following ten years. It stayed within the range between $300 and $400, hovering around its 200 day moving averages for quite some time, disheartening many traders and investors by price movements up and down, but around the moving averages.
It showed strength when it broke key resistances as well as its 200-day moving average on higher volumes in July 2004 to move past $400. It gained momentum, and began to show break-out signals sometime in October 2005. Prices hit $500 in December, where a lot of people booked profits, and this allowed the price to steady for a month or so. 2006 saw a near vertical rise for gold on very high volumes, with gold hitting $700 and then making a high of $725.75 in May 2006, just before the liquidity crisis hit world markets.
A long correction followed, which was inevitable after such a steep and swift rise, and gold retraced to 50% of it rise. This fall was steady, and prices moved down to $575 levels till October 2006. It is here that they stabilized and then continued its bull run to a point where gold now trades at $1500-$1650 levels in the past twelve months.
Buyers faced many worldwide issues throughout this time, because the U.S. was coping with the Iraq concern, Israel invaded Lebanon, North Koreans fired rockets too being a nuclear bomb, and making use of a nuclear confrontation with Iran and the European sovereigns debt crisis. With potential calamities facing the world, gold did actually effectively and served its role like a safe haven for investors. Despite all this, looking from year to year, gold continues being significantly higher.
Gold bullion and gold coins now seems to be getting ready for another long-term secular bull market. Whichever way you see it, gold has a good run in the past ten years, and it is currently consolidating , ready for the next bull run to head for newer highs in the next few years.
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