Gold ETF Report: Should Investors Expect Bullishness Ahead? (GLD, IAU, GDX, GDXJ)
Christian Magoon: Gold ETF products SPDR Gold Trust (NYSEARCA:GLD) and iShares Gold Trust (NYSEARCA:IAU) finished with more than 1% gains for the week as the Federal Reserve announced it would continue to keep rates low into 2014. Perhaps more material for gold ETF investors is what the Fed did not say. No indications were given for a QE3 or further liquidity measures thus keeping gold from a strong surge upward. Here’s the physical gold ETF performance grid from GoldETFs.biz showing recent returns.
Physical gold ETFs are virtually now flat over the last four weeks after a plunge downward beginning in late February after Federal Reserve testimony. They still remain positive for the year however.
Gold stock ETF products had a good week as well. The largest gold stock ETFs, Market Vectors Gold Miners ETF (NYSEARCA:GDX) and the Market Vectors Junior Gold Miners ETF (NYSEARCA:GDXJ), gained 1.4% and 3.7% respectively. Despite the solid week of performance, all ETFs in the peer group are negative year to date. It should be noted that GLDX, the worst performing gold ETF this year, had the best week of all gold ETFs by rebounding over 4%. Here’s the gold stock ETF performance grid snapshot from GoldETFs.biz.
Gold ETF products head into the new week with European developments and U.S. market data likely to be key catalysts. The mood seems to be slightly bullish for gold as Bloomberg reports that fund managers have increased their gold stakes as of April 17th. In addition, half of the gold traders surveyed by Bloomberg expect gold to increase in price this week. That percentage is a two week high.
From a technical standpoint GLD, the largest physical gold ETF in the world, is trading slightly below its 150 day moving average and is on an upward swing. It will be interesting to see if GLD has enough momentum to cross over the 150 day, a feat that has been denied multiple times over the last 45 days. To conclude this week’s Gold ETF Report, here’s the stockcharts.com GLD 150 day moving average chart to chew on.
Christian Magoon is Publisher of GoldETFs.biz and IndiaETFs.com. He is also CEO of Magoon Capital, a strategic consultant firm to asset managers. Christian Magoon is an ETF insider, having launched over 40 ETFs in the United States to date. A widely recognized thought leader on finance and market issues, Christian regularly contributes to many financial media outlets. Prior to forming Magoon Capital in 2010, Christian was President of Claymore Securities (now Guggenheim Investments), where he built one of the fastest growing and most innovative ETF businesses in the country, gathering more than $3 billion in AUM in three years. He launched more than 40 ETFs, introducing many “firsts” to the U.S. market, including the first Frontier Markets, Sector Rotation, Solar Energy, Timber, BRIC and suite of China focused ETFs. Christian consistently provides his industry insights and knowledge as a commentator in the U.S. media speaking publicly on macro investment issues and ETF related topics. In 2008, he was named by Institutional Investor News as one of the five people to watch in the U.S. ETF marketplace. In 2011, Financial Planning magazine dubbed Christian an “ETF Pioneer.”