As an average guy looking at the what’s and whens of PM purchases, I’d like some help understanding this concept. Just read "It’s Hit the Fan" from Chris, and Greg Roberts post in the "Definitive GOLD Near-Term Outlook" thread regarding the 10 fundamental reasons to own gold. My understanding of "overbought" is when there is excessive buying with respect to the fundmentals of a given commodity, e.g., it costs $1.95 to make a stapler and everyone has at least one, but Obama has championed one in every room so they’re now going for $50. I’ve seen various technical analyses with lines on charts going "too high". In light of the existing fundamentals laid out by Chris and Greg, and the fact that an increasing number of Earthlings now "living the lie" are starting to realize it, is it possible for gold to be "overbought"? If the term is meaningful now to whatever degree and I just don’t get it (most likely) I’d like to be straightened out. Perhaps it just has short-term relevance. Could someone clarify the use of this term for me?
When I go get some PMs (soon), I won’t be quibbling about today’s ups/downs or whether it’s overbought. The way I see it, in the future it’ll likely be the best thing to have (only thing?) and therefore +/- 10% or 20% these days is just a drop or two in the bucket.
Viva — Sager