It doesn’t get much more intensive than this.
Gold traded yesterday above $1,365, and it is picking up steam ahead of what could be a move that takes it towards the magical mark of $2,000 an ounce.
Take a close look:
Oh, we’re right there. It’s just a matter of an additional 2%-3% gain for this to technically be defined as breaching the resistance level.
Now, technical analysis, time and time again, confirms that the size of the range is approximately the size of the breakout. In other words, today’s range is between the low of $1,051 and the high of $1,360 – a $309 range.
Flip that around, and we’re right on the cusp of heading to $1,670 per ounce in a matter of a year or two.
On the other hand, we have the USD.
It is also playing with long-term trends, but not the resistance line. Instead, it is asking permission to smash its support, and dive down to the underworld.
Take a close look:
The same rule applies here. The range dictates the size of the drop. At its peak, the USD index was around 105, now it’s sitting on the support line of 89, so that’s a 16-point range.
Flip it on its head, and we’re headed towards 73, which is close to its all-time lows.
The last time we were talking about the USD and dealing with the index trading at the low 70’s, it was 2008.
So, I’m going to tell you what I’m personally doing right now.
Dividend Portfolio Overview
Insurance: Allianz, Axis Capital, W.R. Berkley, and Aflac. All positions are HOLD.
As you can see, the Federal Reserve has taken the lead and is already shrinking the balance sheet. The ECB is next.
By mid-2019, the entire central banks’ balance sheet will be shrinking with each passing day.
I would be surprised if, between 2019 and 2030, we don’t see a major debt jubilee.
So, regarding my high-yield portfolio, next week I’ll be publishing my top three retirement stocks.
I have never been able to time the bottom – it’s not a skill I’ve mastered, and I don’t intend to.
My strong suit is the ability to use dollar-cost averaging for one to two years in the mining sector, and when the slingshot, that is the gold market, finally catapults to the upside, breaking through all price manipulations, my cheap positions will be massive and in the green – there is no other way of doing this – patience is the key.
I am aware that this is hard. Many can never double-down on a stock that is already down 45%, but they’ll never make a fortune, unfortunately.
The most significant lesson Sir John Tempelton taught me through his books is to have faith in cycles.
Gold shares have been the most horrific investment class of the past eight years – they are so bad it’s laughable.
Therefore, I’m buying them right now in quantities that make my CPA blush.