HOW TO LOSE MONEY ON GOLD

Easy. You only need to buy gold this January and holding still today. The SP500 gained this year 30% and gold lost the same percentage. Many of us well remember in the last couple of years how many times we heard the gold is a perfect investment for your savings, it is the perfect money haven. That is not true anymore. 30% is a brutal loss within a year, it is not a collapse, but might hurt much. The gold bubble has burst in 2013.

This year certainly started with expectations for 2,000usd, but now we are closer to 1,000usd. After 13 years long run, this year the price volatiled the trend and turned clearly south. 2013 is the first year since 2000 when the price went down on yearly basis. The long bull run is over. That 30% is the biggest annual lost since 1984. The popularity of gold is over, most of traders left the market only small investors are active, which is a clear indication of bearish sentiment.

Whata are the reasons? I have some ideas:

• 13 years is a long period, always needs to come correction after that long bull rally
• The stock markets got started gain again, no more scares about the recession
• Many investors looking for alternative investments, like property, shares or bitcoin 
• Tapering might mean smaller inflation too, which is bad for the value of gold
• The crisis is over

Technically all the support levels were taken this year, it was not a free fall, but consistent and steady. For the bulls, there is no bottom in sight from a technical viewpoint, just look at the chart:

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The BFM Assets Team.