Gold is under pressure today as the US dollar hit its highest level in 90 days. The USD has taken a beating lately but with the dollar index nearly 97.5, short term investors may look to take a pass on gold and see what the Fed decides to do with interest rates. If the Fed raises rates at the next meeting gold will test $1,300 and perhaps lower. Regardless of this recent activity there is still a steady flow of USD going into gold funds and ETF`s.
A move lower would delight bullion investors who are looking to pad their positions and buy the dip, while first time bullion investors get the opportunity to buy at a lower price. One strategy favored by bullion investors has been to gradually accumulate – cost average purchasing. This method is shared by many experienced bullion investors that like the idea of having a backup to the USD and Wall Street. With the possibility gold could move lower bullion investors are on alert.
2016 has proven to be a big year for gold and silver and many experts believe a consolidation phase could be near. What is important to note is generally speaking a solid bull market doesn’t go straight up in fact those type of markets have no legs and cannot sustain the weight of the fast increase in value. History has also shown us highly volatile price swings usually lead to considerable drops and lower prices. With that said we have seen a steady flow of dollars going into gold and silver bullion during this historic run. Now may be a time for pause. If you like the idea of buying the pullback now may be your time to make a move. If you have questions call one of our specialist at 888-928-3390.
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