Q: The price of Gold reversed today after touching an all time high of $3500 and closed lower, below $3400, in Tuesday's session. Gold miners also followed suit and reversed course mid day to close lower, after opening higher at the open. Do you think, this price action is important from technical perspective and signalling a near term Top for Gold ?
Today's comments from the US Treasury Secretary appear to have triggered a relief rally in equity markets and perhaps was one of the reasons, Gold/Gold equities ( safe haven) performed poorly.
Are you concerned with this price action and would recommend cutting Gold exposure ?
Thank You
Today's comments from the US Treasury Secretary appear to have triggered a relief rally in equity markets and perhaps was one of the reasons, Gold/Gold equities ( safe haven) performed poorly.
Are you concerned with this price action and would recommend cutting Gold exposure ?
Thank You
5i Research Answer:
We would not be concerned; Considering 25 new highs this year, positive momentum, and the econonmic/rate outlook, we would see a correction as somewhat natural. Yes, gold has been stronger as an 'insurance' play, and positive comments elsewhere will have an impact, but a single day reversal should not be taken as overly significant. It is less than 24 hours from an all-time high. Some price consolidation may occur, but we doubt the overall trend has changed much here. Technicals will be more telling after a few more days or weeks, rather than a single day move.