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Could gold pice do a bitcoin and hit $10,000 an ounce in 2018?

December 10, 2017

New York (Dec 10)  After bitcoin’s spectacular price spike this year, could gold be about to stage a similar grand finale to its bull market that began back in 2000?

Bitcoin also took many years before its final speculative reach-for-the-sky. Indeed, the scramble to buy at the last minute has been reminiscent of gold’s previous price spike back in 1980 after a long run up in prices during the economically unstable 1970s.

There are certainly goldbugs who argue for $10,000 an ounce convincingly. Ex-CIA macroeconomic adviser Jim Rickards’ latest tome, The New Case for Gold explains how gold will again be needed as a linchpin of the global economy.

Recently he has been writing this could come as soon as January 1, with a new kind of gold standard as an answer to US dollar instability.

Locally Richard Poulden, chairman and chief executive of Dubai-based and London-listed gold trader Wishbone Gold, has eloquently presented the case that massive Chinese gold buying in recent years can only be explained as preparation for a gold-backed yuan.

However, for either of these theories to come true, and it has to be said many macroeconomists would consider them far fetched, then the signs ought to be clearly visible in gold charts now and from fundamental analysis too.

Let’s consider the technical charts first. Now while it is true that some speculators have dumped gold in 2017 to jump on the bitcoin bandwagon, and done very well, it is also true that gold has had a very good year.

In fact, gold prices in 2017 have risen from a low of $1,127 and peaked in the summer at $1,348. This is actually the gold price's best performance since 2010.

In short, the recovery from the 2011-2015 gold price correction has been gathering momentum. Without going into complex statistical analysis, some important chart trend lines have been broken in a bullish direction.

TheNational

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