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Some understanding of cycles is useful in trading gold. Gold was in a long-term (or secular) bear market from 1980 to about 2000. The period almost aligns with the secular bull market in equities from 1982 to 2000.
What happens when precious metals goes into a secular bear market? Well, miners go out of business, only go after the richest strains first, do not spend money on exploration. They sell forward contracts further depressing the price of gold. Then when demand starts to turn up, miners can't produce, they can't ramp up exploration and production, they have to deal with permitting issues - especially environmental, they have to then use the less rich mines because the rich ones were mined in bad times.
Central Banks become complacent when gold prices tank as gold is the tell on how well central bankers are doing. Politicians and central banks have room to pump when gold is down. You can read about the GATA lawsuits if you want to learn about what central bankers have done to suppress the price of gold if you are curious but knowing that really isn't fully important for trading gold.
I know a guy that lost all of his retirement money trading gold this past decade. Gold is up 1,000 percent over the last year. They guy made a lot of money and thought that he was god, levered up and got killed. It happens.
If you don't like gold or gold miners, there are lots of other commodities to play around with. Soybeans, coffee, sugar, orange juice, chickens, eggs, etc. Even iPads. Of late, Rare Earth miners have been on an absolute tear.
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