- It’s obvious that we are very much in an uptrend, and I think at this point in time we continue to see a lot of questions asked of the market, and where we might be going in the longer term.
- It’s worth noting that the Jackson Hole Symposium has come and gone, and the markets are reacting accordingly.
- The speech by Jerome Powell suggested that there is a significant amount of interest rate cuts coming from the Federal Reserve, and the US dollar of course paid the price.
By doing so, this allows gold to rise over the longer term, because gold of course has a negative correlation to the US dollar quite often. Ultimately, this is a market that I think is going to continue to see plenty of buyers, mainly due to the fact that every time we pull back, I have seen buyers jumping previously. Furthermore, I think there are support levels underneath, especially near the $2480 level, and then again at the $2400 level. As long as we can stay above the $2400 level, I think that gold remains in a bullish trend.
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There are a multitude of factors for buying this market, not the least of which is going to be the fact that there are quite a few geopolitical concerns out there that continue to cause headaches. I believe given enough time, traders will continue to jump back into the gold market for safety, as it is a market that I think will continue to be looked at through the prism of portfolio protection.
Furthermore, we also have the situation where traders are interested in trading against the US dollar due to the fact that there are more interest rates coming, and a lot of people will be looking at this through the prism of perhaps taking advantage of that. After all, if rates start to drop, it makes it more palatable to pay for storage when it comes to gold, instead of throwing money into bonds. Ultimately, I think this is a situation where you continue to buy on the dip.
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