So Gold is in an interesting spot.
I just sold my GLD position. We are bouncing of downtrend. I am happy to wait a few days and re-enter if we have broken thru and are above the short term top of around $122.5
After that I become a Gold Bull. I will become a Mega Gold Bull if we go above 1370. That would indicate that the bottom is in and has been broken out of. I find this very likely if we go above 122.5
I think the fundamentals are somewhat strong right now as the economic and debt issues emerge. I think we always have to be careful with these thoughts as there is the FED that can kinda fix any issue that comes with our beautiful ponzi scheme that is the Dollar.
But all this can change if the stock market just goes higher from here.
I also think that the FED probably has learned over the last several crashes how to deal with such economic and bank troubles a bit more effectively, so I will never trust this bear case until I see it, and without it the case for gold is mediocre.
If the economy has no issues, the debt problems are being fixed by the fed, the euro does not crash then gold will have a hard time ralling.
IF these things emerge than Gold will become one of the best hedges, as well as a great technical trade that may push this thing up quite a bit.
I do not believe in a new Gold Standard
There are two main reasons. The powers at be won't benefit from it. The FED especially would lose most of its power and currency manipulations and ability of governments to just overspend when they want, would become a problem.
That is a very strong reason against a gold standard. Another reason is that the strong economies such as the US and China do not have a lot of gold, relatively.
If gold becomes money than all of a sudden a country like Germany has 1/2 as much money as the US, with a GDP that is 1/5 and absolutely no international power. China is even worse. Germany fucks up the EU has all this debt to deal with from other EU countries and now all of a sudden becomes super strong again? I don't think so. Why would the US and China want something like that?
So fundamentally there are pro and cons.
However as long as there are economic and currency issues Gold will always be the first fall back everyone thinks of and as such people will use it as a hedge and maybe countries as well.
I like to trade on fundamentals and technicals together which is why I will buy more when the downtrend is conquered and the stock market is going down. If there are real economic issues I will buy even more and make it a majority of my stock portfolio investment.