If we look at gold from the long-term perspective, it’s clear that it hasn’t really done much in the recent months – it’s trading in the $1,200-$1,250 range, which is where it was in the first half of 2016, first half of 2015, for most of 2014 and in the second half of 2013. Overall, despite short-term and medium-term price swings, not much has happened in the past few years.
Since the bull market in gold started over 15 years ago, we haven’t seen such a long consolidation pattern – ever. Even the big 2008 plunge was followed by a rally almost immediately (from the long-term point of view, that is). The gold volatility index confirms the above having recently moved to new all-time lows (it’s been published for only several years, but still, that’s an important observation). Please take a look below for details.
Gold’s declining volatility
Now, what does the above (lack of) volatility mean? That the gold market is less and less appealing to traders and investors—at least to those, who don’t believe in the gold market’s strong long-term fundamentals. It’s less exciting and some might even describe it as boring.
But, is this really the time when one should take it easy, stop checking what’s going on in the gold market and wait for gold’s rally? If one wants to miss the event that will likely be called the mother of all buying opportunities, then this is the way to go. Something tells us that you don’t really want to miss something like that.