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Gold Holding In Face Of Equity Meltdown

Commentaries & Views

(Kitco News) - The sell-off in equities gained momentum overnight as global investors stewed over the weekend following Friday’s carnage. The market was already stretched and the rise in the yield curve and a hawkish Fed was the catalyst that created the sell-off. Metals reacted as in past equity market sell-offs, with investors initially raising cash to meet margins and pick up perceived value. Today will be a key indicator on whether this sell-off is a healthy correction or a more ominous trend. A sell-off at the open with a retracement to a positive print by the close would suggest the former. Gold should find support at these levels if the equity market stabilizes. Should this rout in the stock market continue, gold may continue under pressure as the “sell everything” to raise cash mantra unfolds.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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