The gold market has been on the defensive in recent weeks, and the selling pressure has remained fairly constant. In another recent post, the idea of a “bearish extreme” was discussed, as it is oftentimes a good time to buy when the rest of the world is selling. Eventually, that selling becomes exhausted, as there may simply be no one left to sell after long periods of declines.
A very good potential clue that the market may be reaching- or perhaps has already reached-such a bearish extreme is much of the language currently being used to describe the gold market. A few of the recent descriptions of the market include things like “tailspin,” “correction territory,” “free-falling” and “lowering the floor.”
Needless to say, such language is clearly quite bearish, as if the market may continue to fall until it literally hits zero. Of course, that is not likely to happen, but much of the financial media would seemingly want you to believe that such a move may be in the cards.
Such language should be viewed quite differently, and may be considered highly bullish. Many of the biggest fortunes were built when investors saw value while others looked the other way. Consider those who bought stocks in the aftermath of the market crash of 2008/2009. Even then, when markets had seen heavy declines, many investors elected to stay away from the market, fearing even lower prices. Of course, many savvy investors were able to recognize that the market’s drop had likely been way overdone, and that the S&P 500 trading for less than 700 might represent an excellent long-term value. Investors that got into the market early have since enjoyed a steady run higher for the last decade.
When the next recession hits, however, the Fed and other central banks will likely not have as much ammunition to fight it as it did 10 years ago. The next recession could potentially be deeper, longer and even more challenging for policy-makers. When stocks eventually reverse course-possibly in spectacular fashion-investors will have little choice but to seek out alternative asset classes in which to put capital to work. Gold could very well be at the top of the list.
That is why now-right now-could represent the type of buying opportunity that only comes around once in a great while. As the stock bull gets closer and closer to its conclusion, gold could be getting ready to make a long-term bottom and embark on a multi-year cyclical bull market.
According to a recent report by the World Gold Council, current prices may present a great entry point for investors. A recent article by kitco.com stated that the WGC said in its report that: “Gold’s recent pullback is supportive of consumer demand, as low prices tend to spur buying; at the same, it may provide attractive entry levels for investors.” The article went on to quote the WGC report as saying: “Gold’s long-term returns are positively linked to economic growth, but its short-term performance is more sensitive to risk and uncertainty,” the report said, “And gold’s dual nature could benefit from key macroeconomic trends developing in the second half of the year.”
Indeed, many things could change in the second half of the year, and in the years and decades ahead. That is what makes right now the ideal time to buy physical gold. At current levels, the metal may represent an excellent long-term value and adding it to your portfolio has never been easier.
Speak with an Advantage Gold account executive today about the potential benefits of gold ownership. Our associates are here to answer any questions you may have, and can even show you how to buy and hold this key asset class using your IRA account.
Don’t wait for the next major stock market implosion or for the next recession to hit before taking action. Explore your options for gold ownership today. Call Advantage Gold at 1-800-341-8584 to get started now.Tags: advantage gold, buying opportunity, central banks, Fed, gold, recession, world gold council