The gold market is
looking a lot like it did early in the millennium, at the start of
the bull market. It is setting up for a gold bull market that is
likely to be way more intense than the previous one, due to the
structural weaknesses incurred by the monetary system since then.
Debt levels, for
example, have grown significantly since the early 2000s. US Goverment
debts (Federal debt) as a percentage of GDP has grown from 55% in
2000 to 105% today.
There will soon be
significant market movements to compensate for the unsustainable debt
levels. If your debt levels are becoming too high, at some point your
credit rating will be affected to the extent that lenders will
require higher interest rates and/or they will refuse to provide you
any credit. This is true whether you are an individual or a nation
state.
So, the firepower
that was available to keep the system afloat, during the previous
gold bull market, has been depleted. Economic decline and higher bond
interest rates is coming, and these are rocket fuel to a gold and
silver jet (read
more about this).
Below, is a Dow/Gold
ratio chart:
There was a
long-term support line in place from 1980. The support was violated
in June 2002, and it was warning of the coming gold bull market.
Again there was a support line in place since the gold peak in
2011.The support was violated in December 2018, and again it signaled
the coming bull market.
Below, is the same
chart compared to a gold long-term chart:
See how gold broke
out soon after the support was violated on the Dow/Gold ratio chart.
Currently we have the same situation where gold has broken out from a
downtrend since 2011, some time after the support violation on the
Dow/Gold ratio chart.
This will be the
third wave since the peak in the Dow/Gold ratio, and it is often more
intense than the first.
For more on this and this kind analysis, you are welcome to
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service. I have also recently completed a
Silver
Fractal Analysis Report as well as a Gold
Fractal Analysis Report.
