You may have heard analysts and commentators saying getting into gold before it is too late & it is going to 'infinity and beyond'. They also often mention 'FOMO' which is 'fear of missing out'.
My thoughts are that whilst there are going to be strong moves on the price of gold, everything goes in cycles and there are as many forces pushing the price of gold down as there are pushing the price of gold up. These downward forces include; short sellers, profit takers, central banks not wanting people to lose confidence in fiat currency, commercial traders and the list goes on. We now have such excessive global cheap debt that my suspicion is that commercials/central banks/governments are using cheap money to write naked shorts on gold that pushes the price down and buying physical at the same time when the price is low. Central banks can create money out of thin air whereas gold is a scarce and precious resource. Plus it is common knowledge that many countries are now starting to prepare for a dollar collapse so are purchasing bullion as a hedge.
Charts as we know them are simply a view of psychology and as the price goes up it gets to a point where people start to think if the commodity/currency is too expensive and over-valued (over bought). At this point they will generally sell and wait to buy back in when the price goes down to a point where they think it is a good buy again. Gold is a little different as people are buying for a longer term safe-haven and although the majority of volume on spot gold is speculative, the bullion purchases are definitely longer term investments. The counter-balance is that the price of gold is measured against typically the USD, when the USD drops the price of gold goes up. So what can happen is that positive sentiment and demand is focused on gold PLUS the dollar can be dropping which accelerates the price action.
My personal opinion is that silver is more under-valued than gold and silver also has more industrial usages than gold. However silver is quite unpredictable, a bit like a family with 2 children, one (the golden one) is reliable, respectful and predictable, whereas the other (the silver one) is unpredictable, can be nice one day and terrible the next.
So, do you trade gold on FOMO, do you jump in and then regret it if the price goes down? Or do you jump in and make a squillion if the price rockets up? The reality is that the people talking about FOMO'ing in are selling when the people buying on fear. Is it better to have regret of not getting into a trade and missing a move than getting in a losing your 'hard-earned'?
There has to come a day of reckoning when the past actions of central banks and governments are realized. Gold may hit $25,000 oz. Silver may be $1,000 oz. However at that stage a loaf of bread may also be $500! My preference is to spread risk, not have too much debt and aim for consistent returns rather than trying to nail the big price moves.