Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.

Time to bank some gold profits for now

By Gary Newman

10 February 2016 06:13

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With turmoil on markets across the world, gold has seen a resurgence in popularity since the start of the year. It was as recently as late autumn of 2015 when many seemed to be predicting that gold would drop below the $1,000 area, and could possibly even go as low as the $800-850 range.

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Comments

Duck and Dive

10 February 2016, 08:55

Congrats on that good call a month ago. You may be right about taking profits now but I see gold as a simple seesaw play versus the US dollar — and judging by Janet Yellen’s downbeat comments today, I rate the dollar likely to fall further, in which case gold will continue to climb.

http://www.bbc.co.uk/news/business-35540132
Duck and Dive

10 February 2016, 09:30

…And see this interesting video interview:

http://www.bloomberg.com/news/articles/2016-02-09/oil-drillers-exposed-in-three-way-hedges-as-crude-dips-below-30
Gary Newman

10 February 2016, 10:00

Duck and Dive,
You may well be right and i could be being too cautious – I just see it at a level now where it has hit resistance and the safest play is to wait for it to choose a direction. I’m always wary as well when there has been such a big rise on a large company, ands it is hitting the highest levels it has seen in the past year. In terms of physical gold, I do think it will be interesting to see if China continue buying at the same rate. It was only November when there was talk of a return to $800-850 and many thought it would drop below $1000 for sure!
James

11 February 2016, 05:44

As gold has broken convincingly through the $1200 level today, will you revise this article and your advice?
Duck and Dive

11 February 2016, 06:11

Gold up to $1238 and RRS up intraday over 5% and trading above £6. At what time of the day or week is the $1200 resistance deemed to be broken?
Gary Newman

11 February 2016, 13:39

James,
All comes down to how much higher people think gold is going to go, as well as how well equities in gold producers will fare if the markets continue to crash. I would still be more than happy to have banked 34% profit on a FTSE100 company in the space of a month and its always easier with hindsight – plus I still believe that the risk/reward was much better from the 4200/4300 area than it is if people were to buy in now.
Often it is more about making a good profit than necessarily buying at the exact bottom and selling right at the top anyway.
Just my opinion of course.