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Gold Prices in the Future

Let's consider where Gold prices might be headed in the future

We'll use five Gold price prediction charts to illustrate different Technical analysis methods we can use for forecasting

Caveats

We're just spit-balling here

There is no investment or trading advice intended in these charts

The charts are just thought tools for visual thinkers

The Charts

Each chart illustrates one of five prediction methods and the corresponding price targets

All of the charts are in the monthly timeframe

The Results

We'll consolidate the price targets from all five charts into a single table and look for clusters in the results

If multiple methods provide similar results we might assume that those targets have a higher probability of being reached

Gold Price Forecast Next 5 Years - Andrews Pitchfork Strategy

Andrews pitchfork rules tell us that the next median line becomes a high-probability price target as a price trend progresses

In this chart, we are using a Schiff pitchfork to produce a Gold price forecast for the next 5 years

It appears that Gold has pulled back to the median line of this fork and found support

If that is the case, then a price reversal to the upside is likely and the upper median line of the fork and $2320 becomes our next target

When price reaches that level, if it does, Andrews pitchfork rules define the behavior that is likely to occur at that point

 

Gold price forecast for next 5 years based on Andrews pitchfork strategy

Price target Year
$2320 early-2022
$2880 mid-2023
$3465 early-2026

Future Price for Gold - Inverse Head and Shoulders Pattern

This chart illustrates a head and shoulders continuation pattern in Gold's long-term uptrend

Once a continuation pattern completes, there is a high probability that the previous Market trend will resume

In this case we have Gold working on the second shoulder in the head and shoulders bottom

To determine the future price for Gold using head and shoulder pattern rules we find the maximum distance from the head to the neckline

We then add that distance above the neckline at the point of expected breakout to find our price target

The inverse head and shoulders pattern doesn't give us a time prediction method so we'll make a guesstimate 

Because the pattern took nine years to complete (2012 through 2021) we will assume that Gold will take nine years to reach the pattern's target price

 

Future price for Gold based on head and shoulders continuation pattern

Price target Year
$2765 2030

 

Where are Gold Prices Headed - Fibonacci Extension

The trend-based Fibonacci extension tool is applied to three significant price pivots in a price chart in order to predict the next potential price pivot

In this chart of Gold we are choosing 1999, the start of the last major bull rally, as our first price pivot

The price peak in 2011 gives us our second pivot and the bottom in 2015 gives us the third

Notice that the price of Gold reached the predicted 0.618 Fibonacci extension level in August of 2020 before pulling back

The fact that the Fibonacci tool exactly predicted the August 2020 price peak suggests that the other Gold price predictions made by this application of the tool could also be accurate

 

Where Gold prices are headed based on Fibonacci extension 

Price target Year
$2357 early-2023
$2713 late-2025
$3744 late-2030

 

Historical Gold Price Data - Percentage Gain

In this chart we consider prior bull markets in Gold and determine price targets based on the assumption that the past behavior could repeat

As the historical Gold price data shows us, there have been two significant rallies in the price of Gold

Rally dates Starting price Ending price Percentage gain Multiplier
1969 to 1980 $42 $875 2083 20.83
1999 to 2011 $252 $1920 762 7.62

 

If we assume that Gold bottomed in 2015 at $1046 we get these potential targets based on similar gains

Starting price Percentage gain Price target
$1046 762 $7970
$1046 2083 $21788

 

We don't get a time estimate from the historical Gold price data so we'll guesstimate again

Let's arbitrarily pick 5 years and 10 years as the time needed to reach these targets

Price target Year
$7970 2026
$21,788 2031

 

As an alternative, we might note that the prior rallies were 11 and 12 years in duration so the current one could be similar

From the bottom in 2015 that would give us a potential rally end in 2026 or 2027

Gold Price Forecast 2030 - Parabolic Trend

SWAG: Scientific Wild-Ass Guess

This chart illustrates the idea that the rally in Gold could continue to accelerate until it ultimately goes parabolic

Note that there is nothing scientific about this prediction method

We are just applying a simple curve tool to a price chart and adjusting it until it looks good (whatever that means)

In most parabolic price movements the driving factor is overly-bullish investors and speculators who buy at any price

Gold is unique because it acts as an investment vehicle while also maintaining the monetary role it has held for 5000 years or more (see Gresham's Law and Exter's Pyramid)

A parabolic trend in Gold is likely to have two driving factors:

  1. investors and speculators being overly-bullish
  2. ongoing monetary debasement as central bankers and politicians "solve" every challenge with printing press money

We have reached a point in the global economy where all of the central banks are furiously running their printing presses to create more fiat currency

As of late-2020 this printing totals about $300 billion US dollars per month

The printing is likely to accelerate going forward because of additional Covid-relief/stimulus packages, the New Green Deal, UBI (universal basic income), and retiring Baby Boomers (10K per day are turning 65 and becoming eligible for social security, medicare, etc.)

According to the experts, it will be OK to pay for all of these items with printing press money because of MMT (modern monetary theory)

Others believe that MMT is just a re-labeling of failed Keynesian principles and that the price of Gold will continue rising as long as the printing presses remain on

 

Gold price forecast based on parabolic trend

Price target Year
$2700 2023
$5000 2025
$9000 2027
$21000 2030

 

Gold Price Prediction Charts - Consolidated Targets

Technical analysis method Price target Year
Schiff variation of Andrews pitchfork $2320 2022
Schiff variation of Andrews pitchfork $2880 2023
Schiff variation of Andrews pitchfork $3465 2026
Head and shoulders bottom $2765 2030
Fibonacci extension $2357 2023
Fibonacci extension $2713 2025
Fibonacci extension $3744 2030
Historical Gold price data $7970 2026
Historical Gold price data $21788 2026
Parabolic trend line $2700 2023
Parabolic trend line $5000 2025
Parabolic trend line $9000 2027
Parabolic trend line $21000 2030

 

In the consolidated results we can see that there are clusters around $2300 and $2700

We can also note that these potential price targets are supported by the most scientific prediction methods we are using in our Gold price prediction charts: Andrews pitchfork and Fibonacci extension

Gold price prediction chart

When we are considering potential Gold prices in the future we can factor $2300 and $2700 into our analysis as possible price targets

Given that Gold has already reached $2070 (August 2020), it seems reasonable that $2300 might be the next significant price target

It might also be reasonable to assume that this target would be reached in 2021

The target at $2700 would be very aggressive for 2021 but, as Mark Twain said, "There's no fever like Gold fever!"

 

The charts in this article can also be found on the Satori Traders GMB site: