Here’s a quick history on where the bull market in gold bullion has taken us thus far and where I expect the price of the metal to go from here:
Starting from $250 U.S. per ounce in 2001, gold prices rose steadily into 2006, surpassing $700 U.S. per ounce this past May. A natural and long overdue price correction took place in June of this year bringing gold back to the mid-$500 U.S. an ounce level.
Fast forward to today and gold bullion has come a long way since June. In fact, gold is up nearly $100 U.S. per ounce since its 2006 low set in June.
Where does the price of gold bullion and quality gold stocks go from here? Higher–much higher for those with patience.
Since 2001, it’s been a great bull market ride for gold investors. Many gold stocks have doubled, tripled, even quadrupled in price. But like all bull markets, the gold correction in June of this year took the “froth” off gold stocks and sent the “Johnny Come Lately” gold speculators home licking their wounds.
Right now, I see gold stocks consolidating, forming strong and healthy bases for their next up leg. It will take time. It may even take enough time for investors to think the bull market in gold isn’t coming back, before it does. That’s how bull and bear market works: They tend to resume their trends when investors have about given up.
Long-term, if you believe the vast debt U.S. consumers and governments have accumulated will eventually topple the U.S. dollar; if you think oil prices will remain high; if, like me, you sense the U.S. real estate market is in trouble; and should the bear market in stocks which started in 2000 continue… then you understand investors will have very little left to turn for storing their wealth except for gold bullion.