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Gareth Soloway: Not Time for Gold to Move (Yet), Next Calls for Oil and Uraniumyoutu.be
A strong US dollar is creating headwinds for gold, but the yellow metal is holding up well.
“When the dollar goes up, gold generally reacts and goes to the downside,” said Gareth Soloway, chief market strategist at InTheMoneyStocks.com. But this time around there’s more to the story than that.
“The dollar’s rallied 15 percent this year and gold is only down about 4 to 5 percent for the year,” he continued, explaining that normally if the dollar was up 15 percent he would expect gold to be down 15 percent.
“The fact that it’s only down 4 to 5 percent tells you that it’s actually doing its job and holding onto its value very, very well, especially when you compare it to the S&P 500 (INDEXSP:.INX), or bitcoin or anything else,” said Soloway.
“Eventually the dollar will pull back dramatically; then gold will have its big epic move.”
In terms of pricing, he thinks the precious metal may make it back to US$2,000 or US$2,050 per ounce this year, but doesn’t see it rising to US$2,400, the level he thought could be in the cards at the beginning of 2022.
“Dollar strength has just taken a lot of energy out of the sales of gold,” said Soloway.
He also spoke about oil, where he sees more downside ahead as the US economy continues to signal that a recession is coming. Recessionary concerns in Europe and China are also not helping its prospects.
Soloway has a brighter view on uranium, mentioning that the Sprott Uranium Miners Fund (ARCA:URNM) has had an “amazing move” over the last couple of weeks.
“I think overall this is a bullish consolidation macro pattern,” he said, noting that this is a long-term positive for uranium. However, shorter-term investors should be careful if the fund gets to US$86 or US$86.50 and look for a pullback.
Watch the interview above for more from Soloway on gold, oil, uranium and the overall markets.
Don’t forget to follow us @INN_Resource for real-time updates!
Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
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Image and article originally from investingnews.com. Read the original article here.