Is The Gold Bull Cycle Over?

Stronger dollar further reduced demand for gold after two quarters of losses. Silver and palladium also declined. The buillion was at $1,598.58 per ounce at noon compared to previous price at $1,598.75 on March 29. The price decreased 4.6% in the past three months.

According to Bank of America Merrill Lynch in London, gold will average $1,670 per ounce this year. This is a decline from a previous forecast of $1,680. Most of this bearish movement is because the business cycle is currently at recovery state. Is it really the end of the bull cycle?

Hold your horses! (And your gold buillion and gold shares.) Jeff Clark gives light to some interesting points.

In the middle of one of the greatest gold bull markets in modern history – the one that culminated in the 1980 peak – gold experienced a 20-month, one-way decline. Every time it seemed to stabilize, the bottom would fall out again. From December 30, 1974 to August 25, 1976, gold fell a whopping 47%. However, those who saw the bigger picture held on to gold and stayed alert. Their patience paid off after three years and seven months when gold hit its December 1974 high. After 18 months it went up to $850.

So what is the moral of the story? Gold could fall consistently this year, but in 2015 or 2016, it can hit four times its current price. Are you willing to take the risk?

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