The strengthening U.S. economy is translating to a stronger dollar, which is often a problem for gold. Gold, like other commodities, is denominated in dollars, meaning it has an inverse relationship to the U.S. currency.
“You probably won’t see the squeeze until about $1,225. Gold will need to get past those numbers for some volatility and for the squeeze to really kick in,” said George Gero, a managing director at RBC Wealth Management, in an interview with Bloomberg.
Tom Lydon’s clients own shares of GLD.