Gold Price Trend Forecast 2018

By: Nadeem_Walayat

This is the fifth and final part of my Gold analysis that concludes in a detailed trend forecast for the Gold price for the whole of the remainder of 2018.

1. Gold Price Trend 2018 Recap
2. Trend Analysis
3. Seasonal Analysis
4. US Dollar
5. Forecast Conclusion

However the whole of this analysis was first made available to Patrons who support my work. So to get immediate First Access to ALL of my analysis and trend forecasts then do consider becoming a Patron by supporting my work for just $3 per month. https://www.patreon.com/Nadeem_Walayat.

Formulating a Trend Forecast

The overall impression I am getting from this analysis is that the Gold price rally off of the mid August low is not as strong as it first appeared to be. The performance in seasonal terms is leaning towards negative outcomes. The technical picture is again weak, and elliott wave is saying that the Gold price is in a bear market. Throw in the dollar and well that's the proverbial nail in gold's coffin for a bull run to the 2018 highs.

So sorry to all the gold bugs out there but this analysis is not resolving in a positive outcome.

Why are the technical's so bearish? Well there must be a number of fundamentals weighing down the gold price such as the relative strength of the US economy, stock market and of course rising US interest rates which are a negative for the Gold price, all this whilst the gold bugs focus on just the positives such as rising inflation, when instead they should be looking at real terms interest rates.

In terms of trend, Mid September into October 'should' be strong, beyond that it's probably bearish into Mid November with some light relief for December. So I am just not seeing a setup that is conducive towards Gold getting anywhere near it's earlier 2018 high of $1369. At best gold has made a bottom for the year and will trend sideways between about $1200 and $1260. At worst it's going to resume it's downtrend and make new lows for 2018 hitting a painful $1050. So the gold price is definitely not shouting buy me, in fact it's looking rather risky i.e. the risk vs reward is NOT GOOD!

Gold Price Forecast Conclusion

Therefore my forecast conclusion for the most probable direction for the gold price for the remainder of 2018 is for the Gold price to rally into October targeting a trend towards $1260, at which point it is most likely to retrace most of this rally into Mid November that will set the scene for a relief rally of sorts during December that is unlikely to see the gold price rally to a high much above $1240.

Now consider the downside risks of a resumption of the bear market south of $1165 on break of which down to a probable $1050. Then the risk vs reward is just not there to jump into gold bandwagon at this point in time if the best it's likely to deliver is a sideways trend with a mild upward bias against risks of new 2018 lows. So I know the gold bugs won't want to hear this but in my opinion buying Gold at this point in time is just not worth the risk, not unless you plan on holding it for the long-term.

And do subscribe for my next analysis that will seek to conclude in a trend forecast for Silver. However the whole of that analysis will be first made available to Patrons who support my work. So to get immediate First Access to ALL of my analysis and trend forecasts then do consider becoming a Patron by supporting my work for just $3 per month. https://www.patreon.com/Nadeem_Walayat. Nadeem Walayat

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Nadeem Walayat has over 30 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.

Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 1000 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

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