With the price of gold near $1,290 and silver trading at $17, here is the remarkable truth about gold vs the stock market, and the question, is the price of gold really headed to $10,900?
Brief Pause For Perspective: Gold or S&P500?
By Michael Oliver, MSA (Momentum Structural Analysis)
August 23 (King World News) – Of course the knee-jerk answer to the best place to be invested this year or for the past few years is the S&P500. It’s all we hear on TV financial news. Gotta buy those dips in this great bull run. There’s no comparable excitement for gold….
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2017 YTD: Gold is up 11.5%, and the S&P500 up 9.47% including yesterday’s sharp rally in the index (see illustration below).
Okay, let’s go back a bit. How about from the 2015 close, meaning performance in 2016 and 2017 combined? Gold is up 21.1%, and the S&P500 up 19.9% (see illustration below).
King World News note: The chart below is a 100-year chart of the Dow/Gold ratio. The Dow/Gold ratio bottomed in February of 1933 during the Great Depression and also in February of 1980. The ratio fell below 2:1 in February of 1933 and near 1:1 in February of 1980. Today the ratio stands at about 17:1 (see chart below).
100-Year Dow vs Gold Ratio
If the Dow/Gold ratio just fell to 2:1 today, the price of gold would be trading over $10,900. The bottom line is that the price of gold is going to radically outperform the Dow going forward, it’s simply a question of how low the Dow/Gold ratio moves in favor of gold in the final phase of gold’s secular bull market.
***KWN has now released the remarkable audio interview with whistleblower and London metals trader Andrew Maguire discussing the US propaganda surrounding Fort Knox, an update on the upcoming 250 tonne physical order for gold and much more, and you can listen to it by CLICKING HERE OR ON THE IMAGE BELOW.
***ALSO JUST RELEASED: Extremely Important Update On Gold & The Mining Shares CLICK HERE.