With the recent upswing in the markets, the short-term technicals point to the Dow Jones trying to retest 25,000 level. Look for short-term opportunity in equities in oversold stocks and sectors up until this level.
As the markets move into 2019, it appears that gold (GLD) is beginning to get its luster back.
Gold prices have risen since bottom in early October, as market volatility and macro issues continues to plague the financial markets.
With strong technical patterns also confirming investors' bullish sentiment on the commodity, our 3 month price target for GLD is at $126.11
After the formation of a solid "Inverse Head and Shoulders", the price ratio between Gold (GLD as proxy)(numerator) and US Stocks ( SPY as Proxy)(denominator) took off past the neckline of 0.39 in early December. A Golden Cross is beginning to form among the 50/200 Day EMA, which in turn further supports the trend.
This indicates that money is flowing into Gold, as a safe haven, as equities and other risk assets move further to the downside.
Looks like weakness is beginning to show up in junk bonds, which in turn, does not bode well for stocks or other risky assets.
It looks like the recent selloff is not just due to market overreaction, but more due to a shift in market sentiment to the downside.
If this persists, look for more downside in Junk and other risky assets.
To see our latest report on the global minerals and metals outlook and investment opportunities, visit our site for a copy of our latest report: Better Your Own Copper Than Another Man's Gold - Global Minerals and Metals Outlook 2018-2023
As the global economy continues to benefit from the resurgence in global growth, bond yields and interest rates have begun to rise for the first time since the Global Financial Crisis.
Find out the latest trends in the global economy, the emergence of the new interest rate environment, and investment recommendations on how investors can benefit from increasing interest rates.
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- To understand the latest economic trends in the global economy.
- Identify the latest trends surrounding rising interest rates.
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