FX COMMODITIES
WHERE IS GOLD HEADING TO IN 2014? Long-Term Prospects of the Gold Market
Gold’s price has been up every single year since 2000 but it will finish in the red this year. Terefore the impressive streak of gains is finally going to end. With this year’s depreciation the interest towards gold declined substantially, however, many traders are now trying to guess the bottom level of the current trend, which seems to bring the interest in this commodity on the rise again. Te topic of this article is to discuss the longer-term trends of gold, and this is why we will focus on the monthly and weekly charts.
GOLD CHARTS ANALYSIS
Let’s start with the monthly chart of gold. Aſter 21 years in a bear market (from 1980 to 2000), gold started a strong and spectacular bull run in the second half of 2000. Its price jumped more than 7 times - from $250 to
54 FX TRADER MAGAZINE January - March 2014
$1920. Te actual peak was reached in September 2011. I personally remember the day of the top very well because the rise of gold was discussed that evening even in the prime-time news program on the most popular Bulgarian TV channel. According to the reports people were buying physical
gold like crazy and several gold brokers commented that they couldn’t manage to deal with all the demand. Te uptrend was very strong at that time and I had no objective argument to expect a peak, but I felt a top might be near. Consequently the gold declined by almost $400 in just a few weeks.
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