Gold prices rose to a two-week high Tuesday morning as Kitco also attributed to rally to “heavy short covering, bargain hunting and even some fresh safe-haven demand.”
Yet Bloomberg News reports that gold’s worst annual start in over 20 years have raised fears the metal’s longest rally since World War I is drawing to a close.
“Investors sold 106.2 metric tons valued at $5.4 billion from exchange-traded products in February, the most since their creation in 2003 … Another 26.1 tons was cut since then,” according to the report. “Credit Suisse Group AG and Barclays Plc say the 12-year rally will peak in 2013 and billionaire George Soros reduced his stake in the biggest ETP by 55% in the last quarter. Prices are within 5% of a bear market after the longest run of monthly losses since 1997.” [Gold ETFs Fall as Soros Scales Back GLD Investment]
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Full disclosure: Tom Lydon’s clients own GLD.