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Gold In Over Bought Condition - Possible Correction To Come

24539 Views 196 Replies 27 Participants Last post by  BillS
Gold analysts indicate that gold is currently over sold and may be due for a correction. The historical top for gold is about $1,000.00 U.S. per ounce. For the past few weeks market action has been bouncing off the resistance at the $1,000 barrier.

Many analysts believe that in order for gold to proceed to the next level there must be a correction (that follows the patter that took place in 2006) downwards in price.

However, in our crazy economic times there is still wild uncertainty about what will happen next. Historically, gold should correct downwards. If this happens it will likely be the "last good time to buy" before gold takes a permanent residence in the $1,000 plus per once price category.

Next peak of market resistance is predicted at $1,300.00 per ounce U.S.

If the price dips it would be a great time to jump in and buy any gold that is available.
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I think the key words are 'that is available' ^_^

personally, I still would rather invest my money in assets that actually DO something, such as property, vehicles, equipment, etc etc...

the purpose of getting the gold is to eventually use it to BUY something, so why not just buy 'something'... ;)
You can buy something later after you've sold your gold. Those that bought at $750 an once have made $250.00 just by sitting around. All the other somethings you can buy right now are going down in value.

Vehicles always drop as soon as you drive them off the lot. They'll be a lot cheaper when the big three file for bankruptcy. Property is dropping. In my area values have dropped by 30% and continue to fall. Equipment is depreciating too. It's a big sell off because factories and local businesses are shutting down. All the while gold is rising.

Buy gold. Wait. Get more "something" for your money. The more gold does up the more everything else goes down. Besides I don't need anything right now. I'm perfectly happy to wait. All the things that currently "do something" are a money losing proposition. If you've already got property and a vehicle you might as well stay invested.

It's buy low sell high not buy, buy, buy, buy.... That's what causes the problem.
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I guess my thought is that buy actually putting money into the community (granted EVERYBODY would have to do it) instead of sitting & hoping for things to actually get WORSE (which is EXACTLY what you're doing by buying gold, don't sugar-coat it) perhaps the downward spipral could be stopped... but then again, that whole capitalism thing only 'appeared' to work for 30 years (since before I was even born!)...
The out of pocket spending by individuals can't and never will be able to offset the trillions of dollars of debt being generated by the U.S. government. Currently the individual share of debt per American is $75,000.00 for every citizen. This includes children and retired folks. Most people don't have a pre tax income that comes anywhere close to that. This is before any bailouts.

It is mathematically impossible to spend our way out of the current economic situation.

It would be like if everyone in New Orleans grabbed a bucket and tried to hold back the flood one armful at a time. Impossible.

Do you honestly want to buy a house, car, et. knowing that in six months it will be worth far less than you paid for it? That goes against every natural instinct a person had. Besides I don't need to buy anything right now. The economic collapse was caused by people buying all kinds of stuff they don't need.

You can't cure an alcoholic by giving him more booze.
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Gold has dropped from $1,000 to $967 an ounce U.S. in the past few days. If it drops below $850 it may be a good opportunity to buy. I doubt we'll see a decline to the $700's.
Do you honestly want to buy a house, car, et. knowing that in six months it will be worth far less than you paid for it?
to WHO?... to you? to me? to some economic 'guru' that says so?

the value of MY possessions to me is FAR more than the price tag attached to them... ;)

Do you know where the bank gets the $160,000 for your mortgage? It's very simple. Someone walks over to a computer and types 160,000 beside your name. With only $27.93 of cash reserves for every $10,000 of assets (as of June 2007) the bank has just created the remaining $159,553 of that interest-earning money out of thin air. When, after 30 years of hard work, you pay off your mortgage, the $159,553 vanishes back into thin air. Not so the interest however. It vanishes into the banker's pocket. Chartered (i.e. privately owned) banks have created about 93 percent of our total money supply ($11.3 trillion as of Sept 2005) in exactly this way. But the cash reserves in their vaults amount to only a paltry $791 billion. (less than $32 billion of cash circulates in public hands). This is called fractional reserve banking, and it's the greatest scam of all time because it creates debt for no reason other than to enrich the banking class. Its long term effect - as becomes clearer every day - is to steadily suck wealth out of the community and into the hands of a few people, a fact that bankers and most politicians stubbornly refuse to admit. Charging interest on money created out of nothing is, in the main, unjust and immoral, and Plato, Aristotle, Cicero, the Bible (Deuteronomy 23:19), the Koran (2:275-278), the Catholic Church, many codes of law and most writers on morals have condemned it for more than two thousand years. The historical name for this evil is usury. Nevertheless bankers enjoy peace of mind because they know that the public thinks they merely lend out the savings of their depositors. In fact, banks create more than 95 percent of all deposits, for when a bank creates a loan it simultaneously creates a deposit. What banks do to justify the accusation of being economic parasites is to lend out interest-bearing money of their own creation using a very thin sliver of legal tender (cash) to back it up.
Unfortunately, there's never been a reform of the banking system while the banks were in the driver's seat. They must first be rendered helpless by an economic collapse. Now that it just might be here two facts should be etched in our minds:

1) a government can lend interest-free money into existence by borrowing from its own bank, The Fed, - unfortunately The Fed has become a puppet of the financial elite, despite its mandate to serve the interests of all Americans ,or... it can borrow interest-bearing money into existence by borrowing from privately owned banks.

2) a government that borrows with interest from private banks, when it can create its own interest-free money, is a government of idiots or thieves.

Unfortunately, people find it easier to believe a lie they've heard a hundred times before than to believe a truth it's hearing for the first time. Maybe the words of Thomas Jefferson
"I believe that banking institutions are more dangerous to our liberties than standing armies. Already they have raised up a monied aristocracy that has set the Government at defiance. The issuing power should be taken from the banks and restored to the people to whom it properly belongs"
will stop any scepticism you may feel when I say that the chartered banks, in collusion with The Fed and with the complicity of the government, are riding on the backs of the citizens of this country.

The following youtube video(s) are much more eloquent than I could ever be on the subject.

P.S. There are 5 videos
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I've been really leery of buying Gold. I feel it's probably at the high end right now and once the fear subsides gold will go down and I can buy it cheaper.
I've been really leery of buying Gold. I feel it's probably at the high end right now and once the fear subsides gold will go down and I can buy it cheaper.
I think that was Canadian's original thoughts on the matter ... :eek: :rolleyes: ;)
Gold is currently at $948 and dropping today. Looks like the correction is on. Just have to figure out when to jump back in and buy. If it drops to the mid $800's I'd watch the action closely. It'll start to spike back up very quickly once the profit taking by holders has been completed.
according to the charts it looks like it drops down to about 70%-75% of the 'false ceiling' then starts going up again
Both it and the current"recovery"of the markets are being artificially produced,I calculate it will drop to 800-750 an ounce then without warning,the market will bottom out and gold will go through the roof!I give it three weeks to a month.
I had a dream last night that Gold was 8000 an ounce. Hope it was just a dream and not a vision :D
I'd say a drop below $800 is highly unlikely. In the event that this did happen I'd start buying as soon as it got below $800 and continue to buy until the price started to rebound. It hit a low in the $930 dollar range the other day for a few minutes.

Anyone doing profit taking at this point is time has to be pretty ballsy. The majority of people with gold will hold no matter what. The sell off will be limited in nature with only a moderate percentage of the total gold in play being traded.

Anyway, if it goes into the $700's I'm recommending a buy.
I got an investor email today predicting $3,500 an ounce gold by this time next year. Sounds overly optimistic to me. However, all voices seem to be indicating prices will travel in the same direction.
I got an investor email today predicting $3,500 an ounce gold by this time next year. Sounds overly optimistic to me. However, all voices seem to be indicating prices will travel in the same direction.
well... it was supposed to be that NOW according to the 'buy gold' e-mails I have dated 08/03/2007 :rolleyes:
Blob - It appears that you and I subscribe to different investor services.
Gold is at $934.00 an ounce today and dropping. If it goes into the $800's it could be a good opportunity to buy.
All the precious metals are dropping........I suspect this drop will be short-lived.
Won't Gold just continue to decline in a Worldwide recession?
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