Gold bumped its head against $1,590 in Monday trading overseas, and has backed off to $1,580 in US premarket trading. Which gives us a chance to follow up on and its effects on precious metals prices.
First, a chart to understand what we’re looking at price-wise. This is GLD, the unleveraged US-market gold ETF.
For the record, GLD hit a new 52-week high on Friday, by 36 cents over the previous high set last Monday. Over the year gold traded above these prices overseas, but “somehow” always managed to drop before US regular trading hours. Nuff said about that for now.
The question we usually ask is “what is gold trying to tell us”. Over the weekend we’ve reflected on the thoughts in Friday’s article, read more on the coronavirus situation, and a lot more about what people are saying about it in public. Meaning blogs and such – we try to ignore screaming on Facebook and Twitter, as that can be simply bothersome without substantive content.
What your friendly Gold Enthusiast is seeing is a mix of panic and ostrich, sometimes from the same people. Ostrich behavior, in case you’re unfamiliar with the metaphor, is when you “stick your head in the sand” and don’t look around or don’t see reality.