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Gold Gets Clobbered Along With Equities

Commentaries & Views

Tuesday was an ugly day for gold, as the metal started lower and never came back. Gold has lost $33 from its recent high and is getting closer to our first target of $1,300. Equities didn’t want to let gold suffer alone as they also got clobbered. Both markets are a mess now and are in danger of taking out recent lows.

Manipulation of currencies by the Fed and central banks around the globe is causing this uncertainty in all markets in general. The desire to control the dollar, which helps artificially control rates, is creating problems for investors and should keep the pressure on gold and equities. To quote Oliver Hardy talking to Stan Laurel, “another fine mess you have gotten us into.”

For now, we are sellers of rallies in both gold and equities but expect some rip-your-face-off rallies in between. It would be no surprise to see gold rally today, but we would be sellers around $1,340. Long-term investors should ignore this action; the markets will be higher over time. Traders should be ready to short rallies and continue to do so until gold closes above $1,365.

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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