Gold bulls are having tough times. The bear market in precious metals is about to close its 4th year. Starting in September of 2011, gold has declined some 40% in USD terms. However, when expressed in other major currencies, the decline is not that outspoken.
The chart below (courtesy of ShortSideOfLong) depicts gold’s bear markets since it started to trade freely in 1971.
Interestingly, this is the second longest bear market. However, what bulls have failed to realise, is that after 12 annual gains leading into 2011 top, this also one of gold’s softest bear markets. Some have been expecting gold to decline at least 40% if not more, similar to the 1974-76 correction.
On a side note, there has only been one bear market that has pushed the price of gold down more than 50% and that occurred from 1980 into 1982 low.