A Precious Pullback
One of the sectors I’m watching carefully right now is gold. Like equities, gold saw a huge run higher through the first two months of 2012. But since March, we’ve seen a decided downturn in the price of the yellow metal. If you look at the chart below of the SPDR Gold Trust (GLD), we can see the surge off of its December low that lasted through the end of February. However, the recent selling has taken the price of this fund down to its 200-day moving average.
The potential for a rapid decline in gold is something I wrote about in the special report, The Complete Guide to Gold Exchange-Traded Funds. In that report, I explained that when gold comes under the pressure of a correction, we usually see some very aggressive selling that takes prices down very fast, and in a very big way. We’ve already seen this situation in March, and there indeed may be more downside to come for gold.
The upside here is that when gold prices finally do settle in, there is a very high probability that we’ll see a big rebound in the value of the yellow metal, and the stocks tied to its fortunes. This jump would be due to fundamental factors, still very much in place, pushing gold prices higher.
If you’d like to find out more about these fundamental factors, and if you’d like to discover how the Fabian Gold Plan can help you make money in gold and gold ETFs, then I invite you to check out my Successful Investing advisory service. A new subscription to the newsletter also gives you access to my special report, The Complete Guide to Gold Exchange-Traded Funds.
Jim Woods is a 30-plus-year veteran of the markets with varied experience as a broker, hedge fund trader, financial writer, author and newsletter editor.
His books include co-authoring, “Billion Dollar Green: Profit from the Eco Revolution,” and “The Wealth Shield: How to Invest and Protect Your Money from Another Stock Market Crash, Financial Crisis or Global Economic Collapse.” He’s also ghostwritten many books and articles, as well as edited content for some of the investment industry’s biggest luminaries. Read more about Jim Woods.
