SEE MORE: Gold Miners ETFs Confirm Strength Against Broad Market
“Gold will pull back at some point. When exactly that will be is unknown, but when it occurs it is likely to present a major buying opportunity based on historical trends that have occurred in gold. Waiting for a pullback provides a lower entry point into gold ETFs, compared to current prices. This improves the risk/reward of the trades, but could potentially mean missing a trade or entry point if gold (and related ETFs) don’t pull back as far as expected,” according to Investopedia.
Some analysts still believe that is possible gold ascends to $1,500 per troy ounce. Gold bullion prices have surged almost 20% this year as the Fed previously signaled it would slow the pace of interest rate normalization this year – higher interest rates typically weigh on gold prices since the hard asset provide no yield and would become less attractive to higher-yielding conservative debt assets in a rising rate environment.
For more information on the gold market, visit our gold category.
Powershares DB Gold Double Short ETN
Tom Lydon’s clients own shares of GLD.