Gold Selloff: Why $4,000 Matters #news #gold #investing

Gold's recent pullback is a healthy consolidation after a 60% rally, akin to resting at a base camp before climbing Mount Everest. The correction is driven by rising yields and negative sentiment, but the speaker expects a test of $4,000, where he would be an aggressive buyer. He sees panic in mining stocks as a sign of a bottoming process.

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Ronald-Peter Stöferle 6.0

Gold Selloff: Why $4,000 Matters #news #gold #investing

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I think that we will test the 4,000 US dollars. But I think you know you really want to be aggressive buyer at those levels.

Gold often drops early in geopolitical or oil shocks because yields rise and the market assumes the Fed cannot cut. Then, as the crisis plays out, gold recovers because the debt and liquidity problem comes back into focus. Is this what's happening here, or is the rate hike repricing doing more damage than the broader risk tape suggests?

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Ronald-Peter Stöferle

We are getting closer to a panic level. We shouldn't expect too much for gold for the next couple of weeks due to weak seasonality and a big U-turn in interest rate expectations. The best analogy is climbing Mount Everest; you cannot run up it, you have to stop at base camp. Gold had a 60% return last year and now needs to digest this move. We are seeing panic in mining stocks, but a bottom is a process. I think we will test the $4,000 level, and you want to be an aggressive buyer there.

The long-term price target is almost exactly the height of Mount Everest (8,900 meters). People forget the magnitude of last year's return for a large asset class like gold.

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