Gold In Need Of A Pullback Before Next Leg Higher (GLD)

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January 19, 2018 9:26am NYSE:GLD

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From Mark O’Byrne: Gold is due a correction after its $100 rally since the Fed raised rates, even as Chinese New Year looms as a potential catalyst for demand.


A near 8% gain in a month is quite a move up in a short period of time and ordinarily one would expect a correction. Frequently a 50% retracement of the gains takes place. This could take us back to the $1,300 level which acted as resistance before. Previous resistance frequently becomes support.

We are always a bit nervous when gold prices rise this much, this fast. At the same time the sharp fall in bitcoin and crypto-currencies is leading to an increase in demand for physical gold and there is  robust demand from China ahead of the Chinese New Year.

We are a little cautious in the very short term but very positive in the medium term and see gold over $1,500 in 2018.

The SPDR Gold Trust ETF (GLD) rose $0.72 (+0.57%) in premarket trading Friday. Year-to-date, GLD has gained 2.40%, versus a 4.60% rise in the benchmark S&P 500 index during the same period.

GLD currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #1 of 35 ETFs in the Precious Metals ETFs category.


This article is brought to you courtesy of GoldCore.


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