"*mmayr, don't get me started on that nonsense, but what I can say is today was of NUMERIC SIGNIFICANCE. Why you ask? Well it was the inverse of 9-11, it was 1-19! Basically it was a PLANNED EVENT!"
That's an interesting thought. Hmmm?
I still think we're going to see gold pull back and then level off. Take a look at the 10-year chart. This parabolic move from mid-December until mid-January has been rather extreme. I don't see the urgency from this standpoint. Granted, it took gold a while to begin moving. . .I just think it's taken this long for gold to begin catching up with its' true value. While I still think there is plenty of room above (based on the current demand), I don't think it's a good idea for gold to just move to what is perceived as "true value" too quickly. Otherwise, it will likely move to an overvalued state and then it will come back down to below perceived value as quickly as it shot up above perceived value. What is the true value of an oz of gold? Only the market really knows. Nothing has changed about 1 oz of gold except for the market's perception of golds value. An oz of gold is the same as it always has been. It's an oz of gold. Nothing more, nothing less.
With ETF's out there, it could account for a slight rise in the value of gold. But it seems abundantly clear there is a major buyer in the market. Fleckenstein believes that buyer is China. http://moneycentral.msn.com/content/P139885.asp Since China has announced they are looking for more suitable places to allocate their surplus, they probably account for some of the move. Other Asian nations could also be following China's lead. Arab nations might also be in on the game. But who really knows? The demand for gold has been increasing, but there are analysts out there that believe the price hike in gold is probably a little premature: http://www.321gold.com/editorials/maund/maund011906.html
Long-term, I doubt investors will go wrong with a percentage of their portfolio in gold as a "hedge" against any potential crisis with the dollar. I have a large percentage of gold and junior mining stocks because of a top-down approach to investing. The industry is hot, right now. And anyone who reads the rotations of the industries in the markets knew it was coming. Now it's just a matter of holding until public perception turns to "gold" in every conversation and then dumping the gold when everyone else is buying it like it's going out of style. Or of course, just holding it and handing it down to future generations.
We'll see. I just don't think this type of momentum can last much longer. Not in what is heavily touted as being the second leg in a secular bull market on gold.
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