Chat with us, powered by LiveChat

Gold Price Will Power To $7,400; Rally Is Far From Over As ‘Perfect Storm’ Brews - Chris Vermeulen

Derek Wolfe

Updated: February 22, 2022

Gold Rally
Editor’s Note:

EDITOR'S NOTE: Are you ready for gold at $7,400 an ounce in the next five years? It seems like an excessively bold forecast. But that’s what market strategist Chris Vermeulen projects given the “perfect storm” that’s currently brewing in the economic landscape. Brushing past the Russia-Ukraine situation, which, at least for now, may prove nothing more than a near-term yet nerve-shattering shock, the longer-term effects of inflation on equities, bonds, and the dollar may dampen the markets with a much slower grind of uncertainty. This gives investors plenty of time to position themselves for either protection or profit. How did  Vermeulen come up with his price targets? It’s in the “technicals,” which he explains clearly in the article and video below.

While geopolitical tensions may provide a short-lived rally in safe haven assets like gold, there is no denying that the metal is still in a long-term technical bull cycle that mirrors the beginning of 2008, said Chris Vermeulen, chief market strategist of

Vermeulen told David Lin, anchor for Kitco News that gold is set to hi $2,700 an ounce in one year, and up to $7,400 in five years.

“I think we’re coming into a pretty major supercycle in precious metals. I think we started back in 2019 and this is about a five-year cycle for gold, and it has been a very tough year for equities, we’ve had a very long bull market, I think things are getting a little long in the teeth in terms of the equities side,” he said. “When the stock markets get to the late stages, this is where we see commodities come to life.”

Vermeulen added that this year, commodities and gold miners are set to outperform the broad equity index.

“We need to see how this market sells off,” Vermeulen said, referring to a scenario in which equities decline. “If it goes into [a sell-off] like we saw in 2020 where it is a panic phase and it goes straight down, it is going to pull gold, it is going to pull miners down, most likely. They’ll probably hold up the best and do okay, compared to the other indexes, but they’ll probably get sold off. Now, if the market chops sideways, and kind of a slow grind lower, that’s the perfect scenario for precious metals.”

While the dollar index has traditionally held an inverse correlation to gold, in the last three weeks the DXY has rallied concurrently with the metal. Vermeulen sees this trend continuing.

“We can still see the dollar and precious metals rallying together. They’re both seen to me as a very defensive play, a kind of global asset. When people get nervous, doesn’t matter where they are in the world, they’ll liquidate, and they tend to move to the U.S. dollar. We’ve seen this happen all the time,” he said, citing the Great Financial Crisis of 2008 as an example.

For more information on gold’s perfect storm and Vermeulen’s outlook for gold miners, watch the video above.

Originally Posted on Kitco

No Investment Advice

GSI Exchange is a publisher and precious metals retailer. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person. You understand that the Content on the Site is provided for information purposes only, and none of the information contained on the Site constitutes an offer, solicitation or recommendation to buy or sell a security. You understand that the GSI Exchange receives neither monetary or securities compensation for our services. GSI stands to benefit from the sell of retail cost precious metals on this site. To avoid hidden costs all prices are listed live 24/7 on this site. Read the full disclaimer

GSI Exchange Infokit - evergreen



Precious Metals and Currency Data Powered by nFusion Solutions