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Chris Vermeulen's  Instablog

Chris Vermeulen
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Chris Vermeulen the founder of AlgoTrades.net Algorithmic Trading Systems. This automated investing system is designed for individual investors and traders. He is also the editor of the TheGoldAndOilGuy newsletter which is designed for gold market traders providing quality ETF Trade Alerts,... More
My company:
AlgoTrades Algorithmic Trading Systems
My blog:
TheGoldAndOilGuy - Gold Market Traders
My book:
Technical Trading Mastery - 7 Steps To Win With Logic
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  • In Three To Five Years Gold Will Be Priceless

    Over the next few years as debt, currencies and countries start to fall apart individuals will be looking to place their money where it will hold its value and buying power during times of extreme uncertainty.

    If you eliminate fiat currencies which are created out of this air and are nothing more than a credit we are left with precious metals and stones. As much as we have evolved over time, we could be valuing things like gold, silver, platinum, and precious stones more so than our currency.

    Let's face it, currencies are swinging in value 20-50% regularly and while most people do not realize it their buying power often is not as strong as it was. Would you rather hold a large portion of your capital in say the EURO which is falling like a rock in value costing you thousands of dollars a month, or would gold and silver which rises in value as your currency falls be a smarter decision?

    Do not get me wrong, I am not trying to be a doom and gloom analyst. And I hope to be wrong, but with so many things pointing to an extreme global change it only makes sense to add some protection in the event something drastic does happen. My new book explains how to protect your capital in detail.

    With the average fiat reserve currency since 1400 lasting between 80-105 years. With the dollar becoming the reserve currency in 1920 the odds point to the dollar being dropped within 3-5 years.

    (click to enlarge)

    Gold Price Chart & Long Term Bullish Patterns

    gold-halfway

    Review Of the 1970-80's Gold & Bubble

    The chart below shows the price of gold, silver, the typical price bubble, and phased of the market which happens in all asset types at some point in their life cycle.

    The red line shows the average market participants emotional state. Yellow line is the price of gold, and the grey line in silver.

    1980bubbleSource: SRS RoccoReport & GoldChartsrus.com

    Current Gold & Silver Bubble - Priceless

    The last bull market in precious metals will be dwarfed by the next one which I expect to start later this year. Over the next 3-5 years currencies, metals, stock market, new policies in the USA, etc… are likely to change more than we ever thought possible.

    2015-we-r-here

    Source: SRS RoccoReport & GoldChartsrus.com

    Priceless Gold Conclusion:

    What does all this mean? It means money is going to move out of dying currencies and into physical assets like gold, and silver.

    There are three different forecasting models for gold I have created. Depending how things play out in the next couple years the low target is $5,000 oz, and highest is $12,000 oz.

    Starting to accumulate physical gold and silver as a long term investment and as insurance for your portfolio is critical. Small denominations are best because when prices sky rocket it will be tough to sell/trade a $12,000 oz gold bar compared to a gram of gold that will be worth $450, or better yet an ounce of silver worth $150.

    With that said my key focus is on trading for income and growth through the use of exchange traded funds. And if precious metals are about to start another bull market there will be big gains in gold stocks which I will be trading.

    Learn to trade, and get my trades live: www.TheGoldAndOilGuy.com

    Chris Vermeulen

    Tags: GLD, NUGT, DGP, SLV, DUST
    Apr 22 3:52 PM | Link | Comment!
  • Safe Haven Play – It Is That Time Again!

    Each year traders try to navigate their way through the financial market and turn a profit. But this is difficult.

    The stock market provides market participants with several opportunities each. With all the holidays and climate changes the market as a whole along with specific sectors typically have seasonal rallies and sell off in price.

    As May approaches many of us are starting to figure out how to play the "Sell in May and Go Away" potential move.

    I cannot help think stocks will start to struggle as indexes test new highs and key resistance levels. The good news is that when money is flowing out of one investment it typically flows into another which provides us with an opportunity to make money.

    Risk capital has been flowing into stocks recently but with the stock market over bought on a short term basis traders will start to protect their capital and move to specific sectors within the market to protect their capital.

    LONG TERM INVESTMENT OPPORTUNITY EXPLAINED - GUIDE/BOOK

    Utilities have been underperforming all year and are not being talked about by anyone. This is a contrarian signal that it will likely become the sector of choice as fear creeps into the minds of market participants.

    The chart below shows price of this sector is trading at the key 200 day moving average which should provide support. Also the bullish chart pattern is pointing to higher prices. XLU

    utilities-sc

    It Is The Season For Utilities!

    The chart below clearly shows where price is trading today and what is likely to happen over the next 2-3 weeks as we enter May.

    (click to enlarge)

    It Is That Time Again - Conclusion:

    In short, US equities continue to be in a long term bull market. It is best to remain net long stocks as the odds of a trend continuing is more likely than not.

    So I feel a great way to get involved in the market here is to get long the utility sector through the exchange traded fund XLU.

    This is just one of many ways to play the market between now and the first week of May… If you would like to learn more or receive my personal trades join my newsletter today www.GoldAndOilGuy.com

    Chris Vermeulen

    Tags: XLU, utilities
    Apr 19 8:18 PM | Link | Comment!
  • Gold Price: Year 2000 All Over Again – How Will You Play It This Time?

    Recently business and financial guru Mark Cuban wrote an article about why this tech bubble is going to be worse than the tech bubble of 2000. This made me take another look at the long term charts again, but instead of looking up the NASDAQ or the tech sector I decided to check out gold mining stocks, gold price and the Dollar index.

    From looking at the price action among the precious metals sector and the dollar it looks and feels like these markets are very close to repeating what happened in the year 2000.

    The chart below is a monthly chart looking all the way back to 1996. I have color coded areas of the chart that represent weak and strong times forgold price. GLD, NUGT, DUST, GDX, GDXJ, UUP

    Gold Price

    Gold Price

    Key Points:
    1. The US Dollar is trading roughly at the same level and trending higher as it was in 2000.
    2. Rising dollar is neutral/negative on commodity prices and resource stocks like gold miners.
    3. Gold price struggled as the dollar rose in value.
    4. Gold stocks fell sharply during the last year of their bear market.
    5. Gold stocks bottomed before physical gold by several months.
    Concluding Thoughts on Dollar, Miners & Gold Price:

    In short, I feel most of the downside damage has already been done to the price of gold. Gold stocks on the other hand could still get roughed up for a few more months before finding a bottom.

    Money is likely to continue rolling into the dollar as a safe haven and this will keep gold and silver prices relatively flat. But once the dollar starts to show signs of increased volatility (top) similar to 2000 - 2001 money will find its way into other currencies and precious metals as the new trade and safe haven.

    Get My Trades In Real-Time: www.TheGoldAndOilGuy.com

    Chris Vermeulen

    Apr 16 9:52 AM | Link | Comment!
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