My 1st Million At 33 – yes, you can do it too

I’ve observed this a couple of times. Yes, gold goes down, and/or go down hard. But then other currencies versus $US go down harder. In the flushing process, the price of gold in foreign currencies increase. Or the gold rises in US currency, but then foreign currencies versus $US rises less. And then gold goes up in foreign currencies again.

It is like a rotating bull fight. And almost always the gold wins against the weakest currency first, which is $US. So the new high of gold in $US comes first. Then it drops, making everyone thinks that the bull market is over. But then gold makes new highs in one currency after another, until the last strongest currency is conquered.

So we recently had a new high in $US. And now it’s very close to new high in other currencies as shown below. One of my bigger problems with the following charts is that it seems to be a double top forming. If gold doesn’t break the double top, then at best, the bull market in gold is really a bear market in $US in disguise.

One should keep an eye on the charts below, and see whether gold can push above. My guess is that there probably will be a minor pullback first before it launches higher. The strongest currency right now seems to be Brazilian Real, Canadian Dollar, Indian Rupee, Turkish Lira, Thai Baht, Iceland Krona, New Zealand Dollar. It appears that the new high will need some work.

Last time when gold zoomed up crazily, it was right after gold finally breaks new high in euro in summer to fall of 2005. I don’t know whether such things will repeat again, but one should watch $GOLD:$CDW for similar signal. Charts for Indian Rupee can be obtained from this link at economist.com.