Investors currently have a lot to digest and the financial media hasn’t helped. Stocks are in melt-up mode as earnings thus far have been strong and as key benchmarks carve out fresh all-time highs. The dollar has also followed suit and could potentially be headed for another leg higher. Risk appetite is strong while market volatility continues to probe lower.
Financial Media Hyping Gold Declines
As far as gold goes, there has been considerable talk of how it has been “broken” technically. The 200-day moving average, which comes in somewhere around the $1266/oz level, has also been a major topic of discussion in the financial media. A break below this region, the “experts” say, could spell significant declines for the metal.
For those who have found themselves caught up in all the hype, a quick reminder: Markets have been here before and they will be here again. Markets do not go straight up indefinitely, nor do they go straight down indefinitely. Markets move in various cycles and can be strongly influenced by a variety of factors.
Greed Is Currently on Top
Another thing that does not change is human emotion. The power of both fear and greed are what really determines market behavior and markets are in a constant state of tug-of-war between the two. Against the current backdrop of fresh all-time highs for stocks and low volatility, greed is currently winning the war. That is exactly why now is the time to be fearful.
There is a variety of reasons that stocks will eventually come down and other asset classes may rise. An aging economic expansion, an aging bull market and the end of cheap money to name a few. As far as the dollar goes, there are numerous reasons it too will eventually come down. Additional QE or rate-cutting and massive, unsustainable sovereign debt levels to name a couple.
The point is this: Despite all the negativity surrounding gold right now and all of the hype that seems to be following stocks, there will at some point be a “changing of the guard.” At that point, stocks and risk assets may tumble while gold and other perceived safe haven asset classes may flourish.
Nothing Has Changed the Bullish Narrative for Gold
Looking at the bigger picture, nothing has changed the bullish narrative for gold. The stock market will eventually falter, the dollar will still likely lose significant value and the powers of fear and greed will always influence markets. These issues have nothing – zero – to do with 200-day moving averages or technical indicators. They have more to do with history and the powers behind market action.
If you take an objective step back for a moment, cutting out all of the noise from the financial media, one thing may become clear: There has arguably never been a better time to start building a significant allocation in gold than right now.
Adding this key asset class has never been easier than it is today. Simply pick up the phone and speak with an Advantage Gold account executive today. Our associates will answer any questions you may have and can even show you how to build a significant allocation using an IRA account.
Don’t wait for the next “changing of the guard” before acting. Explore your options for gold ownership today. Call Advantage Gold at 1-800-341-8584 to get started today.Tags: 401k gold, add gold to my ira, advantage gold, gold, market cycles, overvalued dollar, safe haven assets, stock market highs