Forbes: Gold: You Should Trade What You See on the Chart
Article by Clem Chambers in Forbes
If you look at a chart of a financial instrument and it doesn’t suggest a trend, then perhaps – and most likely – it doesn’t have one.
Markets only trend when they are imperfect or at a rate where the profit to be had is pretty much the same as what you can earn from a ‘riskless’ government bond. When they trend with more implied return than that, something else is going on, and it is either an illusion or something worth backing.
Now look at this chart. What do you see?
What do you see in this gold chart?
Well, I see this:
The gold chart is showing how the price could rocket.
This sort of chart is not rare; it is the sort of price performance that repeats itself time and time again. It occurs when there is a significant reason for a repricing event.
It is the shape of most booms and bubbles, and it normally ends in a bust. However, it doesn’t have to bust if the boom period is long enough or the reason for the rise is big enough.
The reason for gold’s ride is geopolitical, and it will continue ......