The gold rush is on as gold futures spiked to a high of $1,263.90 in early morning trade with fears of global financial instability due to a tumbling stock market, a lower US Dollar, and little yield in US Treasury Bonds. Gold futures remain up $50 per ounce at this time currently trading at $1,244.60 at the New York Commodity Exchange.
The spike in the precious metal began in the early morning hours with talk of European bank’s shares plummeting to multi-year lows and the concerns of how banks are to profit in a low-growth and low interest-rate outlook. The chairwoman from the Federal Reserve added to the gold rush euphoria when she made comments supporting a slower pace of future rate increases.
Nicholas Medina, a futures and options specialist for Capital Trading Group in Chicago, shared his fundamental view of the gold futures market by stating, “The gold (futures) market may be foretelling of an economy to come. Last year gold dropped based on a decent performance, but with the events of other markets so far this year – not so much.” Medina added, “Gold (futures) will naturally rally when there are such worries about our domestic economy and how that will ripple across foreign economies.”
The trend for gold futures is up with no top in sight. Gold futures has turned into a professional’s market with very wide swings happening, so future buyers should be looking for dips.
ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.