Gold’s Short and Medium/Long-Term Fair Values

On December 23rd, NIA alerted you to gold at $1,132 per oz, predicting that it was about to make a $78 rally to its then short-term fundamental fair value of $1,210 per oz, which it achieved in 13 trading days. On January 27th, NIA alerted you to gold at $1,189 per oz, predicting that it was about to make a $59 rally to its then short-term fundamental fair value of $1,248 per oz. Over the last two weeks, gold has soared by $45 to a settlement price last week of $1,234 per oz!

Since NIA’s January 27th alert, gold’s short-term fundamental fair value has declined by $23 to $1,225 per oz. This means gold is currently trading for $9 above its latest short-term fundamental fair value. However, NIA expects to see gold’s fundamentals improve tremendously in the weeks ahead, due to the breakeven inflation rate currently being too low and Fed Funds Futures currently being overly optimistic on upcoming Fed Rate Hikes.

Based on growth in the Real U.S. Money Supply, when gold bottomed in December 2015 at $1,046.20 per oz and once again in December 2016 at $1,123.90 per oz – it was equivalent to when gold reached its secular bear market bottom in August 1999 of $252.50 per oz. After bottoming in August 1999 at $252.50 per oz, gold gained 656% to a high in August 2011 of $1,909.30 per oz!

Based on growth in the Real U.S. Money Supply, gold’s August 2011 high of $1,909.30 per oz is today equivalent to $2,986 per oz. However, this is nothing compared to gold’s January 1980 high of $850 per oz, which would today be equivalent to $18,416 per ozNIA believes that gold has a medium/long-term fair value of between $2,986 and $18,416 per oz!

goldvsmediumlongtermfairvalue

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