Gold
Gold hits the dizzy heights of $1,000 per oz, up 6.6% while the FTSE falls by 15%.
Is now the time to invest?
Over the last couple of weeks Gold has suffered straight losses which have seen prices fall from the dizzy heights of in excess of $1000 per oz to sub $900 recently. Gold is up 6.6 % this year while the FTSE has fallen over 15% amid a deepening recession. Among the many factors that have contributed to the recent volatility in precious metals, the fluctuating Oil price is considered to be paramount & with impending OPEC meetings on the horizon to potentially discuss further cuts in production from its members in order to stabilize pricing – Gold is likely to be one of the main beneficiaries in the short term.
Gold offers a degree of stability in times of turbulent markets & economic uncertainty & these are certainly such times at the moment . Anything that offers even a degree of stability in these very difficult times is viewed to be a positive investment if only to preserve ones wealth .
In the current scenario Gold is one of the few investments that not only protects wealth , but actually increases it & at the very least preserves purchasing power if all the inflationary moves being made by Governments start to unfold. Near term outlook , Gold has recently been prone to some profit taking due to the US Dollar strengthening , a plunge in retail Gold sales in the Middle East & a declining Oil price.
Taking into account that all of these factors are now built into the price, Gold at current price levels appears to be an excellent short term trading opportunity & as well as looking in technically good shape could be buoyed even further by an anticipated cut in Oil production by OPEC.
Long term view, Gold will always be an excellent investment opportunity in times of economic uncertainty & acts as an excellent hedge against weakening currencies & inflationary pressures.
