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“Many advocates of gold note that it’s not the gold price going up but fiat currencies going down. The world has just witnessed a dramatic fall in the Japanese yen, not only against gold but against all fiat currencies. Before the yen we had the euro crisis of 2011 to 2012, and before that the Dollar crisis in 2006 to 2008. So round and round it goes. The question is, what currency is next and how will it impact the gold and silver markets?
The next likely candidate to plummet is the British pound (GBP). The GBP vs dollar chart shows absolute weakness, and a major support has been broken at $1.53 after 4 years of consolidation. The British pound has now technically entered a free-fall zone (see chart below).
The next support is at $1.42. This is similar support and structure breaks to the price action of 2008, when the pound fell from $2.00 to $1.35....
Continue reading the Kevin Wides piece below...
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The GBP gold chart shows that gold is at the point of a breakout as well, but in this case it’s to the upside. It is very similar to the price action seen in 2007. After a long consolidation, the 2007 breakout resulted in a spectacular 48% move in the GBP gold price.
A similar today in would target a stunning GBP 1600 per ounce (see chart above). However, some of the move to GBP 1600 per ounce would have to be due to a general gold price rally vs all global currencies. Let’s look at a USD Index chart to clarify that possibility.
The USD Index (DXY) chart shows a potential topping pattern and is repeating the same pattern of 2005; namely a head and shoulder top formation, followed by a free fall in the DXY (see chart below).
This would accelerate a USD gold price rally as well as the GBP gold price. The larger DXY trend channel shows descending tops within a huge trading band, but the overall theme is still a lower DXY.
The USD gold price breakout point is $1,800, and that would target $2,100 at a minimum (see chart below).
However, the reality is if the DXY and the GBP fall, as I expect, the signal to the market to buy gold would be so strong that a move to $2,500 would be possible in very short period of time.
What is clear from all of this is that money sloshing from one fiat currency to the other as crisis unfolds is what has been taking place. It is next to impossible for anyone not sitting on a trading desk to time the moves. Even the trading desks would be extremely hard-pressed to properly time the moves in and out of currencies.
The bottom line here is that all of these factors are pointing to the fact that mainstream investors will begin to push money into the gold market as the next round of crisis hits, and both gold and silver will be headed to new all-time highs.”
© 2013 by King World News®. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. However, linking directly to the blog page is permitted and encouraged.
The interviews with Rick Rule, Ben Davies, Andrew Maguire, Marc Faber, James Turk, Bill Fleckenstein, Egon von Greyerz and Felix Zulauf are available now. Also, be sure to listen to the other recent KWN interviews which included John Hathaway, Eric Sprott, Art Cashin, MEP Nigel Farage, and Michael Belkin by CLICKING HERE.
Eric King
Key Charts Which Predict A Violent Move Higher In The Metals
The following powerful charts were put together exclusively for King World News by Kevin Wides, out of Switzerland. Once again, this is a way for all King World News readers globally to take an important step back and look at the big picture as we are still seeing some turmoil in the gold and silver markets. Wides illustrates that a very rapid move higher in the metals is fast approaching.
© 2013 by King World News®. All Rights Reserved. This material may not be published, broadcast,
rewritten, or redistributed. However, linking directly to the blog page is permitted and encouraged.
February 27, 2013
