The SPDR Gold Shares (NYSEArca: GLD), the world’s largest physically-backed gold exchange traded fund, is still up nearly 17% on a year-to-date basis and to this point in 2016, no ETF has added more new assets than GLD.

However, the giant gold fund and its rivals have traded modestly lower over the past several weeks, prompting speculation that the yellow metal may be running low on near-term momentum. Still, a case can be made that bullion and exchange traded funds like GLD have rallied too far too fast, meaning that if certain price points are taken out, the yellow metal could be vulnerable to technical selling.

Gold prices strengthened this year as market volatility triggered safe-haven demand. Nevertheless, more long-term investors who are seeking insurance through a gold play should not throw everything into the precious metal. A portfolio allocation of about 5% is adequate for a partial hedge against any more trouble ahead.

“There has been talk that the sharp rise in Gold prices in recent weeks has hurt physical demand for the metal. In India, the All India Gem and Jewellery Trade Federation suggested many shoppers have been postponing their Gold purchases. Holdings in the SPDR Gold Trust (GLD) have steadied around the 820 tons mark. Previously, the ETF’s holdings were growing at a sharp clip, so this may suggest traders might be fatigued or taking a wait and see approach. There seems to be renewed appetite for risk from traders in recent weeks, which may have a negative impact on prices,” according to OptionsExpress.

A potential problem for gold this year is that some market observers believe the Fed charting a course for more rate hikes, though at a measured pace, in 2016 sets the stage for further upside in the U.S. dollar.

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