Additions of safe haven are pummeled on Tuesday as investors pile in stocks, sending the S&P toward fresh highs and Treasury and precious metals slumping. Silver, which has been rallying tremendously lately, is down more than 13% on Tuesday, and silver ETFs are pulling in with it.
Prices of precious metals are down lower in the afternoon U.S. trade Tuesday. Gold has fallen back below $ 2,000, approaching $ 1900, off more than 5%, while silver has lost $ 4 from its recent high, to trading near $ 25.50, a 13% loss.
Traders and investors crept into stocks on Tuesday, prompted by news over the day that Russia has approved a coronavirus vaccine. Despite skepticism from reporters and health experts, Russian President Vladimir Putin told reporters that he had delivered the vaccine to his own daughter. Now analysts are questioning whether a top could be in place for precious metals and other assets for safe haven.
“As I said in my special report from Kitco, I explained earlier today, which included weekly longer-term charts on gold and silver: On a day when gold prices ran $ 85 an ounce per day and silver below $ 2 were, many precious balls of metal can be spicy, asking them, ‘Are market tops in place?’ Of course, no one knows the answer to that question and there are all sorts of opinions and speculations on the subject – especially today, “stated Kitco analyst Jim Wyckoff.
Other analysts are also concerned about the opportunities for precious metals.
“[The precious metal] made yet another attempt yesterday afternoon to reach the record high it set at the end of last week, although it failed and only made it to $ 2,050. The price has been on a downward spiral ever since, ”wrote Commerzbank commercial analyst Carsten Fritsch.
Given the extreme speed and excessive nature of the recent rally in metals, some expectation is of course expected.
“The scale of the upswing over the past four weeks has been too great. This was made clear by the extremely high RSI and the pronounced deviation of the 100-day moving average. Sentiment for gold was extremely positive, with only a minority of participants sounding a note of caution, ‘Fritsch said.
Commerzbank had not ruled out seeing gold retreat up to as low as $ 1,924 an ounce, which is exactly $ 5 away from where the shiny metal is currently trading from 215PM EST.
However, many analysts are optimistic that this is not the end of the road for gold and silver prices, Fritsch noted, adding that the rally will resume after prices consolidate lower.
“However, the long-term outlook for gold and silver remains positive. Prices will probably start to die again when the current correction is ready, ”Fritsch wrote.
Investors wishing to use ETFs to play the precious metals market may consider funds such as the SPDR Gold Shares (GLD) en VanEck Vectors Gold Miners (NYSEArca: GDX) for gold, as theiShares Silver Trust (SLV) and theAberdeen Standard Physical Silver Equity ETF (SIVR) for silver.
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