Gold to Correct as Stocks Rally

by Jordan Roy-Byrne, CMT
The Daily Gold

It has taken a few weeks to play out but our warning of a correction in precious metals (first on August 18) is coming to pass.

Last week Gold, Silver and GDX all formed big bearish reversals at multi-year resistance levels. Yes, these resistance levels (Gold $1550, Silver $18.50, GDX 31) date back to 2013.

Bonds and precious metals have benefitted from the shift in Fed policy as well as fears of recession and growth in negative interest rate bonds.

These drivers could pause or shift temporarily and that would be supportive of stocks and not precious metals. Let me explain.

First, the fears of recession are driven by the inversion of the yield curve. But the problem is the timing.

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