David Fuller's view Interestingly, gold (historic, monthly, weekly & daily) has held up quite well recently, during a testing time for Wall Street since the US Presidential Election on 6th November.

However, there are still some short-term risks related to the present corrective phase for many stock markets. Wall Street's influence on precious metal prices remains significant, probably because of too much high-frequency trading - the risk-on versus risk-off banality - rather than any lasting economic linkage. Currently, a close beneath the reaction low just above $1670 on 5th November would be required to question higher scope in coming weeks.

Meanwhile, I maintain that precious metals are back in an overall accumulation phase which is likely to be quite powerful. After all, it is now almost 15-months since gold's accelerated peak in September 2011. This is in line with previous and approximately 21-month cyclical consolidations prior to new all-time highs within the current secular uptrend.

While the next 6-months may supply some additional choppy price activity, albeit within an overall upward bias, this will mainly be of concern to futures traders. Participate, obviously, but try to avoid too much leverage following good rallies.

Here are some of the technically important bull points:

1. The cyclical correction has been completed.
2. Gold is back within an accumulation phase.
3. Low interest rates remain a tailwind.
4. Money printing remains a tailwind.
5. Supply disruptions in South African mining are potentially important.

Given a little less headwind from Wall Street and other stock markets around the world, it feels as if gold could surge higher in the next few months. If gold's secular uptrend remains consistent - points 1-5 above suggest it will - 2013 should remain mostly bullish for precious metals.

The factors above should provide a realistic medium-term blueprint for gold bullion. Inevitably, there will be plenty of other influences, mostly unknown or overlooked at this stage, which will have either a temporarily bullish or bearish influence on gold. Therefore, while we should not lose sight of the blueprint above, there will inevitably be many short to medium-term tactical decisions to make over the next year or more. Hopefully, some of these will be anticipated and all will be discussed by Eoin and me over the weeks and months ahead.

Meanwhile, here are some further thoughts:

My personal positions in precious metals remain unchanged. I mostly trade these markets in futures contracts with a reputable spread-bet dealing firm because this strategy is tax-efficient in the UK. However, leveraged positions in futures markets never offer the quiet life.

Inevitably, scams in gold and other precious metals increase as prices rise. I do not regard this as much of a threat to my current investments via futures trading, and I am glad that I have not been tempted to collect gold bars. They may feel good - for some - but the risks from fake bars and storage considerations are a growing problem. The sophistication of the 'Swiss Gold Bars Scam' is a concern but I doubt that it will significantly deter overall investment in gold bullion.


I continue to regard gold shares as speculative, for all the reasons previously mentioned over the years. Inevitably, some of them will do well but many others will seriously underperform. They remain a minefield (pun intended).

This review of precious metals will be continued.