It has been a while since I’ve written about gold. It’s isn’t a good thing to check the price too often or be overly concerned with the month to month price, I’ve come to believe. Gold is a long term hedge against hyperinflation.
However, it is worth noting that gold has been in a bull market since Spring of 2024. It attempted to break through the phycological $2,000 price point in August 2020 then again in March of 2022. But both times sellers overpowered the buyers and gold sold off. The price action was relatively benign in 2023 that gold slowly increased and consolidated. In 2023 it finally broke through $2,000 and held, albeit weakly. But then in the spring of 2024 it strongly broke to the upside and went from $2,050 up to the current price around $2,900.
As someone who first built a gold position in December of 2012, and learned to endure a 3 plus year bear market and a roughly 40% decline in price, it is nice to see the yellow metal making new highs. Will it make it through $3,000? Eventually yes. In the short term only time will tell.
But I will provide a guess here, since there hasn’t been a pull back since January of 2024, gold will struggle to hit $3,000 and if it does, will probably selloff and consolidate more before it makes a definitive move above $3,000 and holds it.
Since I don’t have the gift of auric market prophesy I’ve found the best approach with gold is the boring old but tried and true effective approach of dollar cost averaging and building a position over time. Commodities like gold can be volatile and I do think you can own too much gold (as a percentage of your total assets). As always make your own decisions!