“Looking at the charts, the last time the SPDR Gold Shares were seen below $110 was on the first trading day of 2017 — with GLD up 12.4% from its Jan. 3 year-to-date low of $109.37. More recently, the shares have been trading in a tight channel of higher highs and lows since late October, and are on track to close north of their 50-day moving average for just the second time since September,” according to Schaeffer’s.
Since the 1970s, gold has returned an average 10% per year, comparable to the S&P 500 average price performance. Over the past 10 to 20 years, gold has also held up, supported by important structural changes in the market, like the economic expansion of emerging markets, increased use of gold as part of foreign reserves by central banks and the rising popularity of gold-backed ETFs.
Gold’s performance has been supported by the positive effect that rising incomes have both on the jewellery and technology demand for gold and also in the form of long-term savings.
Tom Lydon’s clients own shares of GLD.