As we embark on a new year, let’s hope it’ll be better than last year. We think it will. Even though debt has been soaring and interest rates are near zero, easy money has continued to flow, explains Mary Anne and Pamela Aden, editors of the industry-leading advisory, The Aden Forecast.
This has been an ideal environment for gold, silver and the gold universe, especially combined with a weaker U.S. dollar and its status as a safe haven.
That was certainly the case in 2020. Silver was the top performer surging 48%, while gold rose 25% and the two gold share ETFs we recommended last year — VanEck Vectors Gold Miners (GDX) and VanEck Vectors Junior Gold Miners (GDXJ) — gained 23% and 28%, respectively.
And it looks like this year will be similar, if not better. The major trends for the metals sector remain up. The same applies to the natural resource sector.
They’re set to rise much further and, the fundamental reasons backing this up remain solid. This is also being reinforced by the new Administration which will likely continue these easy money policies to help boost the economy.
We also continue to recommend the gold miners ETFs — GDX and GDXJ. These ETFs should all outperform the other markets as these major trends continue on their upward path.
Gold, silver and gold shares have been rising since end-November. Gold jumped up to its mid-September highs, and it looks like an A rise has started; see the chart below.
Note the indicator is rising from the lows, and if gold can now stay above $1880, it could rise to possibly test the August highs.
Keep in mind, A rises tend to be moderate, so if a new record high is reached in this move, gold will be exceptionally strong!
Under a normal situation, it's unlikely to reach a new high this time around. Silver seems to be leading if it stays above $25.50. It too could test the highs near $30. Gold and silver shares are doing well, especially the silver shares.
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