Gold Tops $1,750
A commentary on recent events by National Gold Group’s Chris Poindexter – February 22, 2012
Reaction to the latest Greek bailout deal by investors was singularly underwhelming as the euro struggled against the dollar and European stock markets turned negative, while gold and crude oil prices moderated.
Even though gold is trading lower this morning, it’s managing to hold ground over $1,750 an ounce and silver over $34 an ounce. In early trading gold is down $2,74 to $1,754.57 and silver is off $0.23 to $34.04. When it comes to gold and silver, sometimes the price is more important than the direction of price movement.
Underlying today’s price action is the feeling that the latest bailout of Greece is merely the next in a series of increasingly expensive payouts that are necessary if Europe wants to keep Greece in the European Union. Or perhaps the real plan is to keep Greece limping along until the EU is better able to absorb the losses of what most analysts agree is an inevitable default. Either way the markets are not impressed with the current deal.
I expect this lull in gold prices to be temporary as big picture indicators still favor gold moving higher on increased volatility. That will likely remain the case until hedge fund managers pack up their toys and move to greener pastures.
Times like these illustrate the value of gold and silver in your investment portfolio, but this might not be the most opportune time for making a large buy. Because of the volatility in the marketplace, small moves are more advisable. While it’s true that raises your transaction costs, the peace of mind is invaluable.
In the months ahead I might consider a series of small sales into rallies, and then buy back in when prices correct later in the summer.
The above commentary is for informational purposes only and is not a solicitation by National Gold Group or Chris Poindexter. It is the commentator’s opinion only and not intended for investment recommendations, and does not necessarily reflect the views of National Gold Group. Any references to outside sources are believed accurate. Past performance is not a guarantee of future results. All commodities involve risk. Investors should consult their financial advisor before making any investment decisions. 
