Gold: Due For a Price Correction? (ETF: GLD, AUY)

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Includes: AUY, GLD
by: Andy So

Gold briefly passed $600 Tuesday before dropping back down. The metal is currently trading at $594.

I believe gold is due for a round of profit-taking since the ride to $600 from mid $500’s was quite smooth. Gold passing $600 is the next key psychological barrier after $500.

I believe we are in the third phase of a bull run and we will see gold post even stronger gains as the metal piques the interest of individual speculative investors who will buy as an alternative currency investment.

Yamana Gold, Inc. (NYSE:AUY) has dropped from its high of $11.64 set April 10th and is currently trading at about $10.50. If AUY drops to under $10 this week, I may purchase some shares in the company. My current buy price for the next 1-3 months remains unchanged at low $9’s.