Will 2018 mirror 2011 as a landmark year for precious metals?

New York (Jan 7)  There is a sense of deja vu as we enter the New Year in the precious metals market.

Last year proved to be gold’s best year since 2010 with a 12.5 per cent gain in price, while its nemesis the US dollar had its worst year since 2003 and lost 9.8 per cent against a basket of global currencies.

So if 2017 was like 2010, will there be a follow through with a really epic year for precious metals in 2018 like 2011? That was the year gold hit an all-time high of $1,923 and silver fell a dollar short of its $50 all-time high of 1980.

Yet amazingly the strong performance of gold in 2017 occurred during a period when many investors became bored with the metal.

Even in the unexpected rally between Christmas and New Year the popular trader’s website Wall Street Window told me it received just three emails after publishing its gold stock tips, and only mine had anything positive to say.

A former Dubai journalist colleague now working in Toronto, one of the biggest markets for gold equities, dismissed my last positive article in The National saying that nobody he talked to there could get the least bit excited about gold for 2018.

Of course this is what you would expect. Gold prices have been chip-chopping sideways since 2011, albeit the charts show a clear turn upwards from early 2016 onwards and a clear breakout in 2017.

But when everybody is a bear and loaded onto the opposite side of a trade that is usually the best moment to go long, especially if you can see a catalyst or two to keep the upward momentum going, and preferably accelerating.

TheNational