The headline makes you think, "Another crackpot?" Dear Reader, you should know by now that I may be a lot of things, but not that. If one were to project the technical chart based on the history of advancements or declines using Fibonacci math, this is the number. It probably will never happen, but we do see gold at $3400 a real possibility. This is how we came to this conclusion.
New 1965 Mustang, only $1995.
Yes, people. That is no typo. In fact, a new VW bug sold for even less. This is the silent assassin of inflation at work. It is mainly due to excessive money printing alongside of deficit spending. You know who the guilty party is, The Federal Reserve. Anyway, back in the day, gold was still under government machinations. It sold for $35 an ounce. However, if you move the dial to 1975 and gold was allowed to move by the markets, it rose to $160, and a new Mustang rose 5x to $8,995. Gold, by the way was still under the influence and pressure of the anti-gold system that settled upon fiat money. It still is. Anyway, fiat money is only money because the government says its money. If you do the math, gold rose with inflation.
Now, fast forward to today. The new Mustang is over $44,000. Inflation has made the same car multiply in value by another 5x. Now, when we do the math, we have to realize that ten years (1965-75) is missing from the equation. Nevertheless, this is how we addressed the formula. We looked at gold's first peak price in 1980. It reached $850 an ounce. So, we multiply that price by 5x to equal $4250. This is what gold is really worth today. Think about that? Gold is always under influence and pressure from the anti-gold standard people.
So, how did we come up with the $6900 figure? We took the yearly inflation rate of the ten missing years and added it to the final result. However, gold will never reach that number unless we return to the gold standard. The only way that could happen if people realize that central banks destroy your currency and standard of living. End the Fed!
What the world needs is a new basket of currencies based on real value.
What is real value, you ask? Any nation could tabulate their currency value by including its precious metals, rare earth minerals, copper, lithium, etc. Then, global trading will have a standard based on commodities that are necessary and add real value to a currency. One should include gas & oil in the mix, but those commodities would gradually shrink due to its polluting nature.
Cup and Handle
If you go back to 2013, gold has formed a cup and handle pattern on a monthly and yearly chart. This is very bullish. If you do an ABC advance or breakout from 2016, one will get a 5x multiple or close to it. The breakout level was $1000. It rose to $2059 in 2020. You get a retracement from then until now. You multiply the percentage, and you reach $6900. We believe the natural progression from today will settle at $3400. The number 34 is a golden Fibonacci number. We love it. With that said, we stand by our three picks. There is a pick in everyone's price range. Our first choice is...
Barrick Gold. It closed last Friday at $24.35. The first test is $26. We see it piercing its previous high of $30. We see $35 a share price. It also pays a dividend that it constantly increases.
Argonaut Gold. It closed last Friday at $1.96. It has a big, down gap due to losing their CEO. However, they will have a new mine that will be very profitable in the near future. They are already profitable. We see $7.75 in the future.
Wheaton Precious Metals. It closed last Friday at $48.10. This is a streamer company with a solid dividend, no debt and strong future mining production. The charts say this stock should rise to $64. Its last earnings report showed a miss. It was due to the Salobo Mine which had excessive rainfall. This is a minor glitch. This caused damage to the mine. We hope that we are right. We get very depressed when we mention a stock and it fails. Let's pray for peace and give thanks to all our blessings. Amen. Peace.
