Gold took a drubbing last week on comments by Federal Reserve Chairman Ben Bernanke seemingly throwing cold water on the idea of additional quantitative easing. It’s hard to believe that gold hit a low of $1,688.77 before prices rebounded back up to close at $1,711.50 on the week.
When the prices hit the $1,780.00 range I suggested small sales into the rally, but now might not be the best selling time, unless you really need the cash. I expected the selling window to pass, just not this soon.
Last week’s price gyrations would be the influence of speculative investors in the gold market and now you know why I don’t like them coming around. Yet the story underlying gold has not changed significantly. Take out the influence of hedge fund managers and institutional investors, and the factors supporting gold prices are still firmly intact.