everybody loves gold

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Gold the most loved asset class in India...at turning point now

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  • EverybodyLoves Gold?April 15 2013Deepak Singhwww.stateofthemarket.net
  • Opening Remarks Myth: You can never lose money on Gold Belief: Indian households have Gold has been such a bought some US$90 bn ofrewarding investment in gold in the last three last 10 years that years..Goldman Sachs everyone holds this belief www.stateofthemarket.net
  • Here comes the shock Dramatic Decline in Gold prices in 2013 from 1700 to now 1400 Gold now at 1410 www.stateofthemarket.net
  • Gold: TheBearish EraBetween 1980 and 2001Forgotten PeriodGold lost 60% of valueduring this period
  • Gold Bearish Era: 1980-2001 Gold peaked around 700-780 in 1980-1981 and then bottomed around 250- 260 by 2000..20 long years www.stateofthemarket.net
  • Gold Super Bearish Phase: 1996-2001 It was the best economic expansion period in US Gold broke down below 200 week ma and stayed below it for 5 years www.stateofthemarket.net
  • Gold: At turning point in 2001-2002? Dramatic Breakout above 200 week ma www.stateofthemarket.net
  • Gold never looked back since then www.stateofthemarket.net
  • But now the Trend Broken Gold Breaks down below 200 week ma www.stateofthemarket.net
  • What does it mean? Gold is set to become trendless Logic:When any asset becomes trendlessits lessrewarding to hold as an investment asset Gold is no more safe haven. Its is going to be very volatile on a day-to-day basis, but there will be no trend on longer-term basis.George Soros www.stateofthemarket.net
  • What does this mean for India? Can we go back to normal period?The craze for Gold shot up dramatically in last 3-4 years Will demand reduce to pre-crazy levels to sub 1% of GDP from current 2.8% of GDP? The answer is it depends how Gold performs from here on. www.stateofthemarket.net
  • What if demand for Gold reduces? What difference will it make for India?As per some calculation: It will free up $200 bnworth of cash flows over next 3-4 years to otherproductive sectors of the economy. Will it happen ? www.stateofthemarket.net
  • Thank You Disclaimer - The state of the market presentation is Deepaks perspective on the market. The presentation is purely for educational purpose. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this presentation you agree to make no trade relying in whole or in part on the comments of the writers Chartsource: Chartalert.com You can send me feedback at 2deepaksingh@gmail.com Twitter handle: smarket www.stateofthemarket.net