Gold ETFs have also been grappling with the surprising results of the U.S. presidential election. Investors widely expected gold to rally if Republican Donald Trump won the presidential election earlier this month, which he did, but that thesis proved incorrect. Democratic challenger Hillary Clinton may have actually been the preferred victor for gold ETFs because historical data suggest gold performs better when Democrats are in the White House.
“Most recently the participants of the gold futures market have become very uncertain about the direction the gold prices are heading for. According to the COT data, this uncertainty, measured by the so – called “spreading”, stands at its highest level since late 2007. History tells that high uncertainty is followed by a strong move in gold prices. However, the direction of this move is unknown,” notes Seeking Alpha.
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Tom Lydon’s clients own shares of GLD.