Some people may be getting nervous especially if they bought gold at a higher number than it is trading today.
But is this fall going to continue? It may for awhile, but look at history. When the economy weakens and the political arena stumbles, commodities such as precious metals gain value.
Therefore, has the economy turned around yet? Has the political arena – at home and abroad – stabilized? The answer to both of those questions is the same, a resounding “no.”
Yet, gold may drop more, and the prices may seesaw for awhile too. But, the world continues to be interested in gold.
Some people may sell to pull profit from their investment, but those same people may also buy again when their actions drive the market prices down.
As one gentleman’s commentary states, “With these all time highs, gold is in uncharted territory and therefore conducting technical analysis becomes more challenging. Where are the resistance levels? Where are the supports? These questions become harder to answer when gold is trading at levels never seen before.”
He goes on to compare today’s gold activity to earlier Major Rallies. The buying and selling during a Major Rally is where most savvy gold investors and traders make their money.
You can find his full article here: Gold Prices in Uncharted Territory
But back to the economy and politics…
Another gentleman commented that Phony Data Won’t Hurt Gold for Long. He made his comments during Friday’s gold drop, but his points remain valid. He observed that worldwide investors were not selling their gold; but they stepped aside while the US markets danced with small gains in the dollar and better-than-expected employment numbers.
Looking at various other commentaries, gold may drop more but not much. Plus with all the negative Ned and Nellie predictions for the economy and the political environment in 2010, gold and other commodities should at least maintain and most likely increase in value.
As is always the case, perform your own research to learn what drives the gold, precious metals and commodities markets.