The gold market has been trending higher in recent weeks as geopolitical uncertainty keeps a floor under prices. The yellow metal has performed quite well given the fact that stocks remain not far from recent highs and the dollar index may be recovering.
Of particular note, however, is the fact that gold trading volumes have been low. Not only that, but sales of gold bullion have been very low.
Why might this be you may be asking?
It’s possible that many investors are trying to take a wait-and-see approach to the Trump administration and implementation of its policies. The administration ran on the notion of lower taxes, massive fiscal spending and a repeal of the Affordable Care Act, otherwise known as Obamacare. .
Stocks have rallied sharply since the November election results, and thus far have shown little signs of fading.
The recent failure to put together a vote to repeal the ACA may put a significant dent in the new administration’s armor. Investors have thus far largely taken the non-vote in stride, but it remains unclear how patient investors are willing to be when it comes to the issue of tax cuts and fiscal spending.
The equities markets may finally be looking a little tired at this point, and bonds have been stubbornly strong in their refusal to really break down.
What could all of this mean for the gold market?
Consider this: The stock market has been moving higher for eight years now. At some point, there is a good possibility that the bull market will come to an end and the bear market will take over. The market could be closer to that tipping point than many currently think.
If and when the stock market house of cards does begin to fall, the downside could potentially be swift and severe. More and more investors who have ridden the market higher for years now may become more and more likely to book profits and hit the exit.
All of that investment capital will likely be looking for a home some place. Why not gold and other metals?
The quiet being seen in gold right now could be misleading in a way. If there comes a time when investors are exiting the stock market in droves, large amounts of cash could be put to work in gold and other perceived safe haven assets.
The gold market could go from very quiet to very loud-and with this shift could potentially come a massive spike higher in prices.
The question is: Do you want to buy gold at $1250 an ounce or $1500 per ounce. How about $2000 per ounce?
If you prefer to buy low, now may be the ideal time. Speak with an Advantage Gold account executive today about the potential benefits of physical gold ownership. Our account professionals are here to answer any questions you may have and can even show you how to buy and hold physical gold using your IRA account.
Don’t wait for the next stock market crash or for inflation to eat away at your purchasing power before taking action. Explore your options today. Call Advantage Gold at 1-800-341-8584 to get started now.Tags: aca repeal, advantage gold, bull vs bear market, dollar index, gold, trading volume, trump administration