Perhaps the heart of our pro-gold thesis is this consideration: governments are inherently inefficient, they attempt to provide services far beyond their genuine fiscal ability and these trends result in deficit financing, growing debt levels and ultimate “watering” down of currency values.

The great question now is whether the correction that followed was an end to that bull market—or just a lengthy corrective phase prior to another important bullish move. Let’s turn to technical analysis of the chart for a possible answer.