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Gold
Jan 6, 2021 7:03:16 GMT
Post by chang on Jan 6, 2021 7:03:16 GMT
Big subject, hundreds of different aspects involved. No intention to lay out a comprehensive post. Let the discussion go wherever it goes (if it goes anywhere). Gold - yes or no?A couple of brief observations: 1. The 1-year chart shows a positive trend. Looking at a more detailed chart, gold has recently broken up both the 50dma and 200dma. However the 50dma is moving down while the 200dma is moving up, and the 50dma may actually cross the 200dma on the way down. That suggests caution, right? Still, though, that 200dma seems to have a healthy upward slope. 2. The US dollar seems certain to get weaker. As such, gold should be a classic commodity hedge. 3. Inflation may not rise quickly while demand for products and services remains muted, but when it does, gold should increase in value as paper money decreases in value. 4. As the sun rises on the Pacific century, the Asian middle class will continue to grow. And Asians revere gold (they actually think of it as a good investment!). I was thinking of possibly holding some GLD in lieu of S/T bonds (my usual cash "parking lot"). Or maybe even stashing away some krugerrands. I know some people, whom I regard as pretty smart, who actually believe in owning physical gold. Krugerrands are actually very liquid, although buying and selling from dealers you will pay commissions (or lose on the spread) each way.
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Gold
Jan 6, 2021 13:17:34 GMT
Post by yogibearbull on Jan 6, 2021 13:17:34 GMT
I have posted in the past about target for gold-mining majors GDX in 50s. The recent upside breakout is from a converging triangle formation. stockcharts.com/h-sc/ui?s=GDX&p=D&yr=1&mn=0&dy=0&id=p74512883279Mix of majors and juniors GDXJ is also interesting. I am not interested in philosophical discussions of holding something(s) forever, but if it trades and can move, I am interested.
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Gold
Jan 6, 2021 13:40:19 GMT
Post by rhythmmethod on Jan 6, 2021 13:40:19 GMT
Big subject, hundreds of different aspects involved. No intention to lay out a comprehensive post. Let the discussion go wherever it goes (if it goes anywhere). Gold - yes or no?A couple of brief observations: 1. The 1-year chart shows a positive trend. Looking at a more detailed chart, gold has recently broken up both the 50dma and 200dma. However the 50dma is moving down while the 200dma is moving up, and the 50dma may actually cross the 200dma on the way down. That suggests caution, right? Still, though, that 200dma seems to have a healthy upward slope. 2. The US dollar seems certain to get weaker. As such, gold should be a classic commodity hedge. 3. Inflation may not rise quickly while demand for products and services remains muted, but when it does, gold should increase in value as paper money decreases in value. 4. As the sun rises on the Pacific century, the Asian middle class will continue to grow. And Asians revere gold (they actually think of it as a good investment!). I was thinking of possibly holding some GLD in lieu of S/T bonds (my usual cash "parking lot"). Or maybe even stashing away some krugerrands. I know some people, whom I regard as pretty smart, who actually believe in owning physical gold. Krugerrands are actually very liquid, although buying and selling from dealers you will pay commissions (or lose on the spread) each way. @chang, I saw yogibearbull post rg GDX. I remember richardsok holding and trading it in the spring/summer. I think he held a lot of it. If you are in contact with him, he may be a good resource as well. Personally, at this stage, gold is not a sandbox I want to play in. The sector movement, a little toward value, foreign (China-centric), small/mid-caps, munis and contrarian (you posted about earlier) are how I intend to play this. I did note my "protective" hedge EDV got taken to the woodshed today. I'll probably add a little as I'm still underweight my goal. I'm preparing for something other than election implications. It's hard to believe the market didn't see the possibility of the election results. The control swing is the slimmest of margins, so there will still be some gridlock, IMO. Just not as much. While the news is focused on GA, that pesky virus is still in full swing. Here in D.C. I've been advised not to go into the University due to violence. Not sure if this supports your interest in gold or not. I wish I was in the warm weather of Thailand!!
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Post by fishingrod on Jan 6, 2021 14:03:46 GMT
rhythmmethod, Please stay safe out there. It looks like it is going to be a bad one. There are a lot of crazies out there. Wondering your asset allocation to EDV if you don't mind? I don't hold gold as it just seems to lag other assets, and looks more like a trader's thing. Fishingrod
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Gold
Jan 6, 2021 14:10:36 GMT
Post by fishingrod on Jan 6, 2021 14:10:36 GMT
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Gold
Jan 6, 2021 17:06:17 GMT
Post by rhythmmethod on Jan 6, 2021 17:06:17 GMT
rhythmmethod , Please stay safe out there. It looks like it is going to be a bad one. There are a lot of crazies out there. Wondering your asset allocation to EDV if you don't mind?I don't hold gold as it just seems to lag other assets, and looks more like a trader's thing. Fishingrod Pretty small. About 5% to EDV. I think of it as more of a mental hedge to keep me from selling equities at the wrong time. So far, the markets seem pretty okay with things today. I was thinking (hoping) there would have been more of a dip. Yeah, I'm staying in today. I'm in N VA so everything is fine. Tale care, RM
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Post by fishingrod on Jan 6, 2021 18:08:35 GMT
Thanks @ rhythmmethod , I think that is a good move. It should zig when stocks are zagging if the negative correlations hold true in times of trouble. I would just be cautious of a steady rise in rates. Good to hear you are not in harms way!! I am also in Northern Va. over the mountain in the Shenandoah Valley. Fishingrod
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Gold
Jan 6, 2021 22:09:43 GMT
chang likes this
Post by nromsted on Jan 6, 2021 22:09:43 GMT
Yes, I do like gold and even own some physical. But I haven't been able to effectively profit from it as an investment. I would work with an ETF that holds physical gold (not just the promise of physical gold) - I'm thinking of PHYS or GLTR.
That said, I appreciate the approach taken by folks like Kitco.com that consider gold as the only true measure of value, and so it prices each currency in those terms. Here in USD-Land, it is hard to accept that premise. We price gold in USD, rather than USD in gold. It may be an interesting mental exercise for us. But for those living with other currencies, that is a key distinction.
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Gold
Jan 6, 2021 22:14:46 GMT
Post by anitya on Jan 6, 2021 22:14:46 GMT
I have posted in the past about target for gold-mining majors GDX in 50s. The recent upside breakout is from a converging triangle formation. stockcharts.com/h-sc/ui?s=GDX&p=D&yr=1&mn=0&dy=0&id=p74512883279Mix of majors and juniors GDXJ is also interesting. I am not interested in philosophical discussions of holding something(s) forever, but if it trades and can move, I am interested. Agree. I learned in 2020 that nothing is forever. I had bought USMV for forever and today offloaded another 1,000 shares and bought MOAT (have been lazy with my Jan 4 trades). I sold my GLD in the summer after holding it for a few years and have not followed it since. I know GLD is not the same as the mining stock but what would be the thesis why we think GDX(j) could be a good trade now? I am inclined to suggest buying industrial commodities vehicle (as long as there is continued upside in the industrial cycle) or Bitcoin if you can. Just my 2 cents.
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Gold
Jan 8, 2021 0:44:40 GMT
Post by chang on Jan 8, 2021 0:44:40 GMT
I have to admit that I don't know what a Bitcoin is. I thought it was just like an electronic bank account or a debit card, i.e., money that can be spent to buy things. Obviously that's not right. What is a Bitcoin and why is it worth $40,000? Does it have any intrinsic growth drivers (like a company stock) or is it a commodity like gold? What is driving the demand? What is the attraction?
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Gold
Jan 8, 2021 1:18:50 GMT
Post by yogibearbull on Jan 8, 2021 1:18:50 GMT
I have to admit that I don't know what a Bitcoin is. I thought it was just like an electronic bank account or a debit card, i.e., money that can be spent to buy things. Obviously that's not right. What is a Bitcoin and why is it worth $40,000? Does it have any intrinsic growth drivers (like a company stock) or is it a commodity like gold? What is driving the demand? What is the attraction? This response to anitya is buried in an unrelated thread. big-bang-investors.proboards.com/post/620/thread"Check Barron's 12/21/20, Part 2: "Bitcoin tripled to 23,000+ in 2020 [ Edit: It is much higher now]. Apps [Robinhood, Coinbase, Cash App/SQ] and online services [PYPL] are making investing and using cryptocurrencies easy but beware of high fees [up to 2%] and bid-ask spreads. Each site has restriction on what one can do with cryptocurrencies. There are Bitcoin ATMs. Bitcoin trade on loosely regulated exchanges 24/7. But there is limited access to Bitcoin in traditional brokerages and there is no Bitcoin ETF [due to SEC reluctance]. There are Grayscale Bitcoin Trust/GBTC and Bitwise 10 Crypto Index/BITW on pink-sheets/OTC. Crypto hedge-funds include Pantera Bitcoin Fund, etc.""
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Gold
Jan 9, 2021 18:05:18 GMT
chang likes this
Post by nromsted on Jan 9, 2021 18:05:18 GMT
Gold sure got hammered this week. Such is the nature of this market. Not that much actual gold is traded, because there's just not that much of it. The price and volume is mostly controlled by trading in derivative financial instruments. Not for the faint of heart. Also note that some of the trusts allow large holders to cash out by claiming physical gold in the trust (rather than being paid in cash). Brings to mind the "and it's gone" South Park video series. www.youtube.com/watch?v=-DT7bX-B1Mg
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Gold
Jan 9, 2021 18:39:54 GMT
Post by chang on Jan 9, 2021 18:39:54 GMT
I noticed that on Friday, when gold and silver were down 4% and 9% midday. Agreed that's a lot of volatility for the original "cash sub". I'm going to watch it for awhile, but I have no thesis for entering or at what level. That's why I liked the coin collecting idea—no NAVs to monitor, no balances showing up on my screen, etc. just keep it under the radar.
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Gold
Jan 9, 2021 19:56:01 GMT
Post by Chahta on Jan 9, 2021 19:56:01 GMT
I noticed that on Friday, when gold and silver were down 4% and 9% midday. Agreed that's a lot of volatility for the original "cash sub". I'm going to watch it for awhile, but I have no thesis for entering or at what level. That's why I liked the coin collecting idea—no NAVs to monitor, no balances showing up on my screen, etc. just keep it under the radar. In 1974, while in school, I bought 5-1 troy ounce .999 silver coins. They were $5 each then. Maybe worth $25 each now? All I need to know about bitcoin: 1) "The price of a bitcoin is determined by supply and demand. When demand for bitcoins increases, the price increases, and when demand falls, the price falls." 2)"The latest iteration of a sustained surge in bitcoin price has seen the cryptocurrency rise by more than 300 percent during the past year. This is the third major cycle of price spikes involving bitcoin since 2013 — the previous two “bubbles” ended with a sharp fall of over 80 percent. Unlike a stock or a bond, it is hard to determine the fundamental value of bitcoin. Its value is entirely dependent on what people think it is worth. Some boosters have claimed that bitcoin could be worth as much as $400,000 while others foresee a spectacular price collapse."
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Gold
Jan 9, 2021 22:47:41 GMT
Post by FD1000 on Jan 9, 2021 22:47:41 GMT
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Gold
Jan 10, 2021 1:02:22 GMT
Post by chang on Jan 10, 2021 1:02:22 GMT
If bitcoin is the new gold, what does its meteoric rise say about the various drivers mentioned in your investopedia link, i.e., are the US dollar, inflation, geopolitical uncertainty, supply chains, etc. all going to hell in a handbasket? I don't think so (anyway not yet). Therefore, I don't think bitcoin is the new gold.
Frankly, I don't have the foggiest idea what a bitcoin is; I only know that I have no interest in it. What happens when it get hacked? What happens when you die and your spouse can't "find" your bitcoins? What happens when some kid in Poughkeepsie sticks a fork into a toaster and all the bitcoins in the world suddenly disappear? (Admittedly I haven't worked out that scenario in detail.)
40,000 bucks is a lot of money; that buys a pound and a quarter of gold. Is a bitcoin really worth that?
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Post by chang on Jan 10, 2021 1:18:17 GMT
This is the third major cycle of price spikes involving bitcoin since 2013 — the previous two “bubbles” ended with a sharp fall of over 80 percent. That says a lot. 80% is a pretty steep drop; you need to rise 500% after that to get back to where you started. But it couldn't happen a third time ...... could it?
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Gold
Jan 10, 2021 1:43:06 GMT
Post by yogibearbull on Jan 10, 2021 1:43:06 GMT
There are only 21 million Bitcoin [that is with upper case B]. So, the supply is fixed but demand varies.
Unfortunately, there are other cryptos, so if crypto A is overpriced due to limited supply but huge demand, crypto B comes along, and then crypto C, etc. That defeats the notion that supply of each crypto is fixed or controlled.
Thing to remember is that crypto transactions don't go through the Western dollar-based money system. So, they are not traceable and not subject to any sanctions. The same for gold, but as noted, money that used to go to gold may have been heading to cryptos for now until they crash again.
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Gold
Jan 10, 2021 15:02:46 GMT
Post by Chahta on Jan 10, 2021 15:02:46 GMT
There are only 21 million Bitcoin [that is with upper case B]. So, the supply is fixed but demand varies. Unfortunately, there are other cryptos, so if crypto A is overpriced due to limited supply but huge demand, crypto B comes along, and then crypto C, etc. That defeats the notion that supply of each crypto is fixed or controlled. Thing to remember is that crypto transactions don't go through the Western dollar-based money system. So, they are not traceable and not subject to any sanctions. The same for gold, but as noted, money that used to go to gold may have been heading to cryptos for now until they crash again. Doesn't mining create more?
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Gold
Jan 10, 2021 15:30:32 GMT
Post by yogibearbull on Jan 10, 2021 15:30:32 GMT
There are only 21 million Bitcoin [that is with upper case B]. So, the supply is fixed but demand varies. Unfortunately, there are other cryptos, so if crypto A is overpriced due to limited supply but huge demand, crypto B comes along, and then crypto C, etc. That defeats the notion that supply of each crypto is fixed or controlled. Thing to remember is that crypto transactions don't go through the Western dollar-based money system. So, they are not traceable and not subject to any sanctions. The same for gold, but as noted, money that used to go to gold may have been heading to cryptos for now until they crash again. Doesn't mining create more? No. The so-called crypto "mining" is a discovery and verification process, not a creation process.
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Gold
Jan 11, 2021 18:16:28 GMT
Post by Chahta on Jan 11, 2021 18:16:28 GMT
A little off-topic, but here you go Admin: link
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Post by richardsok on Jan 12, 2021 5:33:06 GMT
Hello everyone. It's been a long time. After a profitable dump in November, I finally got tired waiting for a sharp gold/silver drop to re-buy.. On today's mini dip I returned to PMs via a silver derivative (SLVO). Not nearly as volatile as the real stuff, but pays a boffo monthly distribution.
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Gold
Jan 12, 2021 12:41:12 GMT
chang likes this
Post by Chahta on Jan 12, 2021 12:41:12 GMT
A little off-topic, but here you go Admin: linkAnd yet gold didn't surge inversely. Which blows a hole in my theory that investors burned by bitcoin would turn to gold. Bitcoin is more alluring than gold. Too much work to find gold. You can spend Bitcoin and mine it like real gold. And the volatility can make you a lot of profit.
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Gold
Jan 15, 2021 2:27:21 GMT
Post by yogibearbull on Jan 15, 2021 2:27:21 GMT
Fall and Winter usually have strong retail demand for gold.
Fall is wedding season in India and then there is Diwali [light festival].
Winter has Chinese New Year.
These only govern retail demand, not investment and central bank demand. So, there are exceptions to these seasonal patterns.
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Post by yogibearbull on Apr 15, 2021 15:51:38 GMT
Gold seems to be rebounding well after a double-bottom in March after a huge hi-to-low decline [August-March]. Hope I am not jinxing it. LINK
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Gold
Apr 15, 2021 21:04:00 GMT
Post by anitya on Apr 15, 2021 21:04:00 GMT
I thought I would increase my calls in GDX and so decided to do some research on GDX for the first time. Since 2010, GDX never had a 1% or more dividend yield. GDX is highly correlated to GLD but the current price of GDX is the same as it was in Jan 2007, soon after its debut, while GLD has gone up 160%.
Am I correct in concluding that it is better to invest in GLD than GDX, even for holding for a few months if not a few years? What would be the basis for investing in GDX vs GLD? Thanks.
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Gold
Apr 15, 2021 21:13:54 GMT
Post by yogibearbull on Apr 15, 2021 21:13:54 GMT
GDX is 2.5x more volatile than GLD. So, there is that much leverage to be right [or wrong].
As trading vehicles, one wouldn't just sit on them for 15 years.
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Gold
Apr 15, 2021 21:25:38 GMT
Post by anitya on Apr 15, 2021 21:25:38 GMT
"GDX is 2.5x more volatile than GLD. So, there is that much leverage to be right [or wrong]." Very good point.
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Gold
Apr 18, 2021 0:30:18 GMT
chang likes this
Post by yogibearbull on Apr 18, 2021 0:30:18 GMT
This story is on the dangers of stashing cash and gold in the house that nobody is aware of. When the last of 4 brothers and sisters died without leaving any direct descendants, their relatives just wanted to get rid of the house in Morez, France that they inherited. They sold it on cheap [130K euro] to the City with all the stuff in it. On cleaning out the contents, City found gold coins and bars worth 600K euros. The City kept all that, of course. www.theguardian.com/world/2021/apr/16/french-officials-perplexed-gold-bars-and-coins-found-stashed-old-house
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Gold
Apr 20, 2021 0:56:34 GMT
Post by richardsok on Apr 20, 2021 0:56:34 GMT
I have about 7% of my net wealth in precious metal and diamonds consisting of (1) baubles on my daughter's wrist and my wife's finger, wrist & ears, (2) GLDI (3) ASA (4) physical coins & bars and (5) a small position in SLV. I just added to GLDI today. I am really glad ASA has recovered from its lows; I have been sick of watching it and may sell. Am pleased with everything else, either emotionally or for investment.
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