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Posted by on Aug 14, 2017 in Market Insight

An Opportunity To Own Gold?

An Opportunity To Own Gold?

August 14, 2017

Dennis Gartman is editor and publisher of The Gartman Letter, and strategic advisor of the AdvisorShares Gartman Currency Hedged Gold ETFs (GEUR & GYEN). He regularly contributes to AlphaBaskets and lends his institutional insight to educate advisors and investors about commodities and the forex markets, including about trading gold in different currency terms.

Spot dollar denominated gold is having trouble pushing through the psychologically important $1300/oz. level and given the seriousness and the swiftness of the recent rally is anyone anywhere surprised by that fact? Certainly we are not and so the question is, “How far down can gold fall from that psychological level of resistance and where then shall we be a buyer on weakness?” for certainly we do not wish to buy gold following the strong rally of the past week or two. However, if spot dollar denominated gold were to make its way back toward $1267-$1272 over the course of the next day or two or three we’d be sorely tempted there, enjoined in bullishness of gold by the likes of Goldman Sachs, Jeff Grundlach, Ray Dalio and others.

This morning we find it interesting that gold has given back little of what it had gained late last week despite the fact that the situation in the Korean Peninsulas has not worsened and has in fact lessened over the weekend. Also we find it worthy of note that gold is actually at or very near to its best levels of the past few weeks in Yen denominated terms for the high last week was ¥141,000/oz. and it is trading, as we write, at or near to ¥140,800/oz. Further, gold/EUR is doing a fine job of consolidating its gains of last week, for having traded down to €1063/oz. early last week and having then traded to €1099/oz. for a few brief moments on Thursday, it is €1097 as we write. Any further consolidation and/or minor weakness should be seen as an opportunity to own gold.

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