The Lemon Fool

Gold is well, GOLD! I like gold, my friends and family like gold, even my cat seems to have an affinity for it. With inflation, the world crisis-19, and all of those stimulus checks that Americans received, we could see gold reach new highs. Do you think gold will continue to rise and see new potential highs this year? Do you currently have gold in your portfolio and plan on adding more?

Year on year figures will see low levels of inflation (Covid shutdown) of March 2020 'spike' up to "reopened" high demand - near zero March/April/May 2020 inflation versus 2.4% March/April/May 2021 inflation type 'rate of change'. Whilst interest rates look likely to remain low (with so many central banks printing money to buy Gilts/treasuries). As such real yields are likely to remain negative and perhaps shift even more negative for a while, which often drives up demand for gold (when given the choice of bank it and pay the bank to store the money (negative real yields) or buy gold which is a form of global currency).

First rule of owning gold is to say that you don't own any gold. If you do own gold then have a target % weighting and just rebalance back to that once/year (or whenever). If for instance you rebalanced around fiscal year end/start then back at the start of April you'd likely be taking some of the +45% type gains that the FT250 or S&P500 made across fiscal year 2020/2021 to add some more ounces of gold as gold was up only +4% for the year. Pretty much a reversal to that of 2019/20 when -20% stock losses and +30% gold gains had you reducing ounces of gold to buy more stock shares.

I wouldn't be surprised if 2021/2022 saw another reversal/flip-around again, but I wouldn't bet on it, its better to invest rather than speculate. More often what you think may occur doesn't work out as expected.

Tuesday's gold Options expiries has $1750/ounce (recent $1777, so a -1.5% lowering required on Monday 26th April) as the point when collective Options writers (big players) see the lowest payout ($62.8 million). i.e. there is potential benefit for the price to be manipulated downward (shorting) by the big guns. Thereafter the shorts might be closed. So predicting a dip early in the week, recovery rebound later in the week.

Gold has seen a reversal in the last week or so of over $100..
I am looking to buy again around $1725, but not physical, account gold…
My main reasons are that I sold at over $2000, around June, which always seems to be a barrier, and I am worried about inflation, which is more than just rearing its ugly head..don’t want to touch crypto and I don’t know any other safe hedges..
Plus here in Germany/Luxembourg we already have negative interest rates on current accounts, so I will be happy with a 5 to 10pc return..