Expert Says Gold Has Harder Days Ahead
“I think soon there will be good news, but I think we’ve broken down and violated a lot of key levels, and I think really, the next real level that I’m going to want to step in, unless we rally sooner, is probably around $1,240 [an ounce],” Horwitz told Kitco News.
Since the last Fed meeting on June 13, in which the central bank raised interest rates by 25 basis points, gold has fallen nearly 3%. Spot gold closed at $1,267 an ounce Thursday, $1.50 an ounce lower on the day.
Horwitz said that investors have been complacent with precious metals lately.
“I think that too many people are making too big a deal out of these trade wars and that is causing [a sell-off in gold] and keeping a pressure on the metals right now,” he said.
Horwitz said that gold’s weakness has been minimally affected by the dollar.
“Gold is a nice hard asset. I don’t think it’s a dollar play any more, not at these levels,” he said. “The dollar is going much, much higher, but I think gold will eventually find its way and go much higher as well.”
The Fed’s widely anticipated rate hike on June 13 has made the dollar stronger, with the dollar index up 1.2% since the Fed’s announcement.
Meanwhile, Horwitz said that silver is always a buy for him.
“As a trader, I wouldn’t always be a buyer of silver, but as an investor, I’m always a buyer of silver,” he said.
The veteran analyst added that besides being a “great hard asset,” silver also has industrial properties as well.