E Gold Bull Market Begins

Gold reached several milestones in June 2019. Prices finished the month and subsequently, the quarter above $1400. The MACD for the quarterly gold chart crossed over bullishly for the first time since 2013. After an arduous 6-year bottoming process, I think it’s safe to say gold started a new bull market.

Now, that doesn’t mean prices will advance directly higher without correcting – that’s not how markets work. But it does mean a trend of higher highs, and higher lows should develop. The 200-day MA will ideally become a floor for prices going forward.

The potential in silver and platinum is compelling. Below is a snippet from an exclusive I wrote for Gold-Eagle.

“Both silver and platinum are lagging gold significantly – some argue a non-confirmation. I think it’s due to their industrial nature. With gold above $1400, it’s probably just a matter of time before investors set their sights on gold’s undervalued cousins.

Think about it. Gold futures are trading at $1433 as I write. Anyone looking to buy may say, “Oh, that is too expensive – what’s cheap?” Well, silver just reached a gold to silver ratio not seen since 1993. Or take platinum – over the last 40-years platinum has traded at a premium to gold about 85% of the time. In fact, in 2000, 2004 and 2008 platinum was more than double the price of gold. Today, platinum futures are trading at $818, some $600 below the price of gold.

Wait – isn’t platinum slipping because the demand for diesel motors is in decline? Yes, catalytic converter demand will wane with the rise of electric vehicles, but that’s a 20-year process (at least). I’d guess less than 1% of all vehicles on today’s roads are 100% electric.

Moreover, something like 70% of all platinum production comes from South Africa. According to www.statista.com, South African production costs were $985 an ounce in 2018. How long will they mine the lion’s share of the world’s platinum supply at a loss? And don’t forget the potential for geopolitical problems (nationalization).”

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