CPM Gold Trade Recommendation
Time Stamp
Prices as of 9:41 a.m. EDT 2 April 2024 $2,280.10 (Basis the June 2024 Comex contract).
Recommendation: Sell
Initial Target Price / Range: $2,160
Initial Timeframe: 2 April 2024 to 16 April 2024
The most recent CPM Gold Trade Recommendation was a Sell recommendation issued on 20 March, when gold was $2,158.10. CPM viewed this price as over-bought. CPM continues to view gold as being over-bought on a short-term basis, even as we expect higher prices later this year. As a result of this view, we are maintaining the Sell signal.
We do not think that investors should close out short-term short positions at the record highs of today and the past few days, which would lock-in or capitalize losses on those positions. Our expectation is that prices will decline on a short-term basis, allowing for those shorts to be closed out at less of a loss, or even a gain.
Gold prices have risen to new record levels in recent days, moving in the opposite direction of CPM Group’s last sell recommendation. Prices look extremely over-bought at this time and seem to CPM to be likely to soften over the next few days. The decline could be sharp, with many short-term investors that have added fresh gold positions during the second half of March taking profits in response to any weakness in gold prices.
While prices are not expected to fall back to CPM Group’s previous sell target of $2,110 a decline to $2,160 is quite likely. Given that prices were at $2,158 at the time of issuing the last trade recommendation, holding that last short position could result in a no profit no loss set up. Additionally, a new fresh short position may also be initiated at this time.
CPM Group expects gold prices to rise in the medium term, but prices seem over stretched at this time, which could create a short-term bout of profit taking.
CPM has one-month, three-month ranges and eight-quarter quarterly price projections with greater discussion of the factors behind CPM’s analyses provided in CPM’s monthly subscription service, the Precious Metals Advisory.
While short-term trade recommendations provide high risk – high reward opportunities for investors, it is difficult to capture the complex web of factors affecting precious metals prices and the nuanced CPM analyses of these factors that goes into our firm’s price projections. In addition to these short-term outlooks, CPM Group provides clients enhanced trade recommendations that include one and three month price projections, as part of our Retail Investor Program. Contact CPM at info@cpmgroup.com for details.
Notes:
Initial Target Prices and Timeframes are just that: Initial. If CPM does not issue a new Recommendation during or after that time it indicates that CPM maintains the posture in the most recent Trade Recommendation. Position may be closed out once target price is reached, within the noted discretion or until CPM provides new trade recommendation. CPM may have reported to have closed out of prior trade recommendation at its discretion before publicly publishing new trade recommendation due to processing time.
Discretion should be allowed at +/- 0.20% of the price at the time each TR is issued from the target.
CPM’s preferred investment strategies use physical, futures, forwards, and options.
