The gold/copper ratio reached its highest level in three years in the third quarter, in what could potentially be a signal for price movement in the year or even years ahead. The World Bank recently, according to Kitco, said that the price of gold is likely to push back towards the $1600 region.
There are numerous potential reasons for gold to push higher as copper and base metals push lower or remain stagnant. In fact, a price of $1600 per ounce represents a less-than six percent increase from current levels over the next year, hardly a home run worth writing home about.
As is often the case, the important parts are in the details, not just what the gold market could potentially stand to gain if things heat up further.
The risks in the gold market are on the upside and could represent the heightened uncertainty and weaker prospects of the global economy going forward.
The recent upside seen in gold is no fluke, either. Central banks have been major buyers of the yellow metal, adding it to their reserves as the global economic and geopolitical backdrop deteriorates further. Global central banks have purchased the metal in its physical form, while smaller investors have been gaining exposure through gold ETFs, jewelry purchases and other means. Whatever the case may be, increasing demand for gold could push prices back to $1600 or even well-beyond that level in the months ahead.
As global central banks look to become increasingly dovish in the months ahead, there could be some heightened volatility.
Both stocks and gold could potentially see increasingly volatile periods in which price movement seems to lack any sense.
When this market volatility becomes increasingly common and/or extreme, investors must keep in mind the long-term reasons for owning gold. Don’t be fooled by short-term fluctuations in stocks, copper or other assets, just stay focused on the long-term issues and you may do just fine.
Adding physical gold to your portfolio has never been easier, and arguably never more important. Simply pick up the phone and speak with an Advantage Gold account executive today about the potential benefits of gold ownership and to learn more about the key role it may play ahead. Our associates are here to answer any questions you may have and can even show you how easy and important it is to add a significant allocation in gold right now. We can even show you how to build a significant allocation using an IRA account!
As the next major global economic slowdown gathers steam, it has never been more important to have a big allocation in alternative asset classes like gold. The clock is already ticking. The time to explore your options is now.
Don’t wait for the next major collapse in stocks or for lower rates and even more QE to erode the value of your dollars or currency further. Explore your options for gold ownership today. Call Advantage Gold at 1-800-341-8584 to get started now.Tags: central banks, demand for gold, global economy, gold, price movement