Gold, Is the Future Still Bright or Fading?

Great editorial from Chris Puplava on Financial Sense Online, Gold, Is the Future Still Bright or Fading?

It has to be great because it does mention the issue I posted the other day. Performance Of Gold During Recession. :D

Chris wrote

• While the inverse correlation of gold to the stock markets was cited above as a bullish support for gold, it can also work against gold. If the stock market bottoms this year there is a good chance that it will be associated with a top in gold, not necessarily “THE” top in gold for this cycle but “A” top. This relationship can be seen by comparing gold with the S&P 500 in the 1973 and 1981 recessions during the prior secular bull market in gold. The figure below normalizes gold to 100 at the onset of the recession and the x-axis is the duration in months before and after the recessions began. What is interesting to note is that gold is following a similar path to what was seen in the recessions highlighted below. If gold follows the 1973 path then it should be peaking in the next month or so at a new high before undergoing a sizable correction, which is certainly possible given gold’s close proximity to its former high. If gold follows the 1981 recessionary path, then we could see strength in gold for another six months before a correction is seen. At either rate, both recessions witnessed a peak in gold anywhere from 13-19 months after the recession began, pointing to a top of intermediate nature in gold’s future in the next six months.
  
  

Do read the editorial in full because it is good with Chris presenting the bullish and bearish case for gold. Gold, Is the Future Still Bright or Fading?