Even though gold hit new record highs of above $2,060 in August, real gold prices (the ones adjusted for inflation) are yet to hit record levels. On top of that, the overview of the investment landscape points to equities being overvalued, which bodes well for gold in 2021.
Gold has done well in time of fiscal easing and more so when it is coupled with current account deficits widening. This year will be historic in taking the twin deficits to the unprecedented 25% of GDP.
From the mining perspective, gold supply is unlikely to rise significantly, which also favors more upside in gold. Gold has the demand support while supply is unlikely to substantially go up. Coupled with a mining clock, there's significant upside on cards," it said. "Mining clock indicates the cyclical point based on the financials of corporates, and turns in a leveraging cycle coupled with an increase in cash flows, pointing at an upside in the gold prices.
This argument is sound, except for the Bullion banks that cannot allow a higher price above 2000. As this market is highly manipulated, they'll dump gold as soon as it gets above 1900+, it doesn't take much to bring the price down, since it's not a speculative trade or favorite of retail traders. I'm very bullish on Gold miners though, as even at these prices, earnings for miners is at historic highs. A weaker dollar is key.
abel11
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@gouvias110, looks to me dollar is about to strengthen, creating the accumulation phase for gold after which i expect higher prices.
Clarkbar2
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@gouvias110, SPEAKING TRUTH IS SELDOM POPULAR... STAY PROSPEROUS AND CORRECT~!! We're like'n the Pan American Silver~!!
@abel11, explanations betray my ignorance.. sorry~!
jojofang0901
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I am seeing the similar bullish potential as well for sure :). For me is about waiting for that correction on the HTF to complete to give me more confluence for further upside. Thank you