According to the author of this article, his technical analysis of gold charts indicates that gold is on the verge of a breakthrough potentially reaching $3,000 an ounce while silver can reach as high as $90/ounce within the next 18-24 months.
By Chris Vermeulen
Jun 21, 2012 9:50 am
Minyanville
Gold and silver have taken more of a back seat over the past 12 months because of their lack of performance after topping out in 2011. Since then prices have been trading sideways/lower with declining volume. The price action is actually very bullish from a technical standpoint.
My chart analysis and forward looking forecasts show $3,000ish for gold and $90ish for silver in the next 18-24 months.
Now don’t get too excited yet as there is another point of view to ponder.
My non-technical outlook is more of a contrarian thought. It's worth considering because it could unfold and catch many gold bugs and investors off-guard, costing them a good chunk of their savings. While I could write a detailed report with my thinking, analysis, and possible outcomes, I've decided to keep it brief.
Bullish Case: Euroland starts to crumble and stocks fall sharply sending money into gold and silver, which are trading at these major support levels that in the past, triggered multi-month rallies.
Bearish Case: Greece, Spain, and Italy will work through their issues over the next few months while metals bounce around or drift higher because of uncertainty. But once things have been sorted out and financial stability (of some sort) has been created and the end of the financial collapse has been avoided, money will no longer want to be in precious metals but rather will move into risk-on.
Take a look at the gold and silver charts below for an idea of what may happen and where support levels are if we do see money start to rotate out of metals in the next three to six months.
The price movements we have seen for both gold and silver indicate were are just warming up for something really big to happen. It could be a massive parabolic rally to ridiculous new highs in 2012/2013 or it could be a huge unwinding of the safe havens as countries sort out their issues and the big money starts moving out of metals and into currencies and stocks.
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