Gold could very well be in the process of making a long-term bottom. Although the yellow metal has been on its heels in recent weeks, gold has held up quite well under numerous potentially bearish circumstances. A more hawkish Fed, higher stocks and strong appetite for risk have all played a role in recent weakness. The question, however, is will it last.
Some believe that gold could be turning the corner. In a recent article from Kitco.com, analysts from Credit Suisse voiced a theory about gold in the coming months. They stated: “In our view, recent softness in the gold price has been driven by [around] 16 million ounces of net Comex selling since June as real rates have risen on the Fed’s signal that it could announce the tapering of repurchases of maturing treasuries with its September meeting, sending normal rates higher, while inflation data has disappointed. Our constructive gold thesis continues to be driven by U.S. real rates surprising to the downside, USD [U.S. dollar] strength waning, dovish central bank approach to future monetary policy, continued robust Chinese investment demand, elevated probability of a disruptive geopolitical event, and positioning in gold, which has turned relatively bearish.”
The analysts went on to say that “In 2017, we forecast mine supply declining ~3% (-96t), geopolitical uncertainty and wealth preservation stoking bar hoarding, and we expect jewelry demand to recover marginally from a very weak 2016.”
The comments from these analysts essentially reflect our own views that rates are not really going anywhere anytime soon and that the geopolitical landscape may keep a solid floor under the price of gold.
Those that recognize the numerous dynamics being seen currently in global markets have the opportunity to make moves right now that may potentially help them avoid being hit hard during the next major stock market crash or economic downturn.
The question is: Are you one of them?
Now may be the ideal time to look to gold as a means of added portfolio diversification and as a wealth-preserving tool. Having trended lower over the last few weeks, you could even potentially view gold as being “on sale” right now.
Make no mistake about it. Gold has shown signs of underlying strength that could eventually fuel a rapid and significant rise in prices. Would you rather buy gold at $1200 per ounce or $1500 per ounce? If an upside breakout does occur, it could simply be the beginning of a multi-year bull market that could see gold prices head to previous all-time highs or even well-beyond.
Adding gold to your portfolio has never been easier than it is today. Speak with an Advantage Gold account executive today about the potential benefits of physical gold ownership. Our associates are here to answer any questions you may have, and can even show you how to buy and hold gold using your IRA account.
Don’t wait for gold prices to rise substantially from current levels. Explore your options for physical gold ownership today. Call Advantage Gold at 1-800-341-8584 to get started now.Tags: advantage gold, bottom, Chinese demand, comex, gold, mining, monetary policy