Why Sprott is Still Bullish on Gold
SOURCE:[The Globe and Mail] – Sprott Asset Management market strategist David Franklin sent us the following statement, explaining why the firm is still bullish on gold:
“The recent price action in gold can only be described as ‘panic selling’. Money managers and veteran traders know that when panic sets in and markets start moving rapidly, ‘investing’ logic drops by the wayside and money begins to flow one direction only. We have seen this over the last two trading days in long gold positions in the futures and ETF markets. This selling in turn drives prices lower, forcing those holders on margin to liquidate their positions. This process leads to even more selling as the pain of holding levered ‘under water’ positions becomes too great, causing traders to liquidate their positions. The light at the end of the tunnel for precious metals investors is that these events have been value-buying opportunities that occur only a few times a decade.
“In the recent selloff, the gold market has been hit from all sides by news and events that have caused significant liquidation in the Comex and gold ETF markets. The first event was a report from Goldman Sachs downgrading its outlook for the gold price, sighting the precious metal’s lacklustre price performance through the Cyprus crisis and a fresh batch of disappointing economic data points from the U.S.
Post from: Gold News from Gold Editor
Why Sprott is Still Bullish on Gold
2013-04-16 12:48:40
Source: http://www.goldeditor.com/why-sprott-is-still-bullish-on-gold/
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