The Gold Bull Market Is Back

When the price of gold moves in one direction across a basket of currencies, then we can find the direction of the actual gold market.

The gold price is a complicated beast. It’s like a seesaw, with gold sitting on one seat.

But instead of one seat across from it, there are several, because each country has its own currency. Those currencies go up and down with regard to each other.

Years ago, a brilliant analyst found that you couldn’t use any single currency to figure out bull or bear markets for gold. Instead, we needed to use the price of gold in a basket of currencies.

If the price of gold moved in one direction across all those currencies, then we could find the direction of the actual gold market.

Beyond the Dollar

We know that the price of gold is up in U.S. dollar terms, as you can see in the chart below:

gold-price-us-dollarsAs we can see in the chart above, gold hit its highest price since October 2016. It looks like gold is in a bull market.


However, the U.S. dollar is also weakening against other currencies. To determine if this is a real bull market, we need to look at the gold price in terms of a basket of currencies.

The chart below shows the gold price in six currencies: U.S. dollar, British pound, Chinese yuan, Japanese yen, the euro and the Swiss franc.

When the price of gold moves in one direction across a basket of currencies, then we can find the direction of the actual gold market.

What we can see is that the price of gold rose in all six currencies since its low in July 2017.

That means we are in a bull market. It’s time to buy gold and gold stocks.

Good investing,

Matt Badiali
Editor, Real Wealth Strategist

  • jrj90620

    You sure summed up that question.Hope you’re correct.

  • SunshineandFleurs

    What about silver?


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  • Thomas Waldenfels

    Okay, but people just need to know that what really moves this market is paper gold trading in New York, and that’s controlled by the gold cartel … the bullion banks, JPM, HSBC, Citi, et al and the government / central bank collaborators who give them their marching orders … the BIS, the Exchange Stablization Fund, etc.

    Prices can rise based on fundamentals and spec fund buying (managed money) … and be snuffed out in the blink of an eye by an orchestrated bear raid or series or bear raids with tens of toms of “gold” contracts being sold naked short in the wee hours of the morning when the order stack on the buy side is as thin as it gets.

    It’s happened so many times, it’s become a joke … just not a very funny one.

    Bottom line: Don’t assume anything much about future prices by looking at charts. Charts don’t matter much outside a very short time window in a manipulated market, and since the bad guys are in on an almost daily basis either driving the price down or capping any rise, I mean very short.

  • John Audie

    Buy CEF – Gold ETF. It’s bottomed out and the only way now is up. I would say 20% in metals is a good bet.