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Gold bull only "wounded" says Ned Davis

  • Ignored as gold investors focus on the negative of late, says the team at Ned Davis, are real interest rates ... they've stopped going higher. Of any number of indicators, real interest rates historically have had the strongest correlation to gold prices.
  • As for weakening Chinese demand, purchases are still massive and the same trend of slowing occurred in early 2013. Other pluses: Reforms in India which could boost demand there and an ECB about to maybe go negative with rates or launch QE (policy meeting is tomorrow).
  • Bullish, but respectful of the price action, the team isn't recommending getting too long yet. "If you are looking for a short-term entry point, this does not appear to be it. Gold’s price action is poor, and sentiment is not pessimistic enough to take a contrary bet at $1246 per ounce."
  • ETFs: GLD, IAU, SGOL, UGL, DGP, GLL, UGLD, DZZ, GLDI, DGL, DGZ, DGLD, AGOL, OUNZ, TBAR, UBG, GLDE, GYEN, GEUR, GLDS, GLDL, GGBP
Comments (5)
  • lasvegasbrad
    , contributor
    Comments (44) | Send Message
     
    How can you write about GLD and utterly ignore SLV? If this isn't the best entry point for SLV, then what is? We just had yet another re-test of the sub $18 low. Back to almost a 5 year low. SLV was around $18 last part of 2009. I just bought 3000 shares SLV down here. In my margin account that uses only around $10K of actual cash.

     

    SLV actually posses silver. SLV did not dump their inventory like GLD has. SLV actually was at $33 as recently as 2012!!! It is a Much better story.
    3 Jun, 11:17 AM Reply Like
  • David at Imperial Beach
    , contributor
    Comments (3636) | Send Message
     
    Don't count the Russian central bank out either. They were heavy buyers in Q1 and could easily choose to put in a repeat performance this quarter. They weren't alone. Other central banks were also net buyers.

     

    ECB stimulation should be priced into the market. Expect gold to go up if they demur.

     

    Commentators are touting US growth expectations of 3.5%-4.0% going forward for the rest of the year. After the -1.0% growth last quarter, this is extremely unlikely. Expect gold to rise when growth comes in at less than half the expectations.
    3 Jun, 11:20 AM Reply Like
  • Philippe97
    , contributor
    Comments (23) | Send Message
     
    If you knew your historic data of (real) interest rates well, you should know there is hardly any correlation with gold.
    3 Jun, 01:13 PM Reply Like
  • thatsforschur
    , contributor
    Comments (46) | Send Message
     
    Surely this IS the time to get into gold/silver. I thought any savvy investor knows you need to get in close to the bottom to be sure you don't miss out when things take off.
    3 Jun, 03:38 PM Reply Like
  • x oil -field
    , contributor
    Comments (59) | Send Message
     
    Ecuador Selling Gold For King Dollar[s] (GS) Gold Goldman Gets Ecuador Gold as Correa Steps Up Hunt For Real Cash. http://bloom.bg/Sr7bBI http://bit.ly/Uibe1i e(GLD) Bloomberg
    3 Jun, 05:38 PM Reply Like
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