I have never been afraid to make bold predictions for the stock, commodities, bond and currency markets when supported by rigorous analysis.
Recently I made a prediction that gold is on its way to $3,000 an ounce unless there is a vaccine and money printing stops. In some ways, this is similar to my call for the Dow Jones Industrial Average DJIA, -0.36% reaching 30,000 points when it was trading around 16,000. (Please see “Here’s the case for Dow 30,000 in Trump’s first term.”)
Let’s examine gold with the help of a chart.
Note the following:
• This is a monthly chart, giving a long-term perspective.
• The chart shows that The Arora Report gave a signal to back up the truck and buy gold when it was in the $600 range.
• Long-term readers may remember that in 2011 The Arora Report gave a sell signal on gold when it was trading at $1,904 — exactly on the day when gold topped out before falling to about $1,000.
• The chart shows that gold has traced a long base. This is very bullish.
• The chart shows Arora’s very long-term rating as positive.
• The chart shows that gold has broken out.
• The chart shows that gold was added to our model portfolio in March 2020 right before the present run-up started.
• The chart shows that RSI (relative strength index) has traced a very bullish long-term pattern.
• The chart shows that in the short-term gold is very overbought. When a commodity gets overbought, it is vulnerable to a pullback.