Opinion with Peter Hug
Gold's Weakness Suggests Investors Continuing To Raise Liquidity
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Featuring views and opinions written by market professionals, not staff journalists.
(Kitco News) - Gold continues to experience pressure as investors generate liquidity in the wake of the global equity shakeout. The bounce in equity valuations yesterday was actually a negative for gold prices, as investors assumed the recent drop was merely a retracement, as with past sell-offs, and jumped back into the equity space. Gold, a proxy for liquidity, came under selling pressure as investors raised cash to average into the equity trade. The dollar has gained, as foreign investors also piled into yesterday’s open swoon, on the indexes. The volatility in the equity space is not over and gold remains a viable hedge. Technically, gold needs to hold the $1,320 area with $1,332 a target for a break higher.