Trend: Almost all metals, especially gold and silver, are in freefall on February 20, 2013, as the major equity indexes flirt with new highs.
Here's a chart of a gold ETF, ticker GLD:
As EconMatters wrote in When the Gold Bugs Start Selling, Look Out! at the end of January 2013:
The Gold Thesis still Valid
I understand the underlying arguments concerning currency debasement by central banks around the world. I understand that mining costs are rising long term as well. But this has been the case for the last 200 years as well.
Price Action different from Fundamental Thesis
All this can still be true, and for a myriad of reasons Gold still goes down from here. Arriving at “fair value’ for any commodity is tricky, but from a trading standpoint Gold acts very weak.
If bonds start to break through 2.25 & 2.50 for the 10-year in yield, Gold could break to the downside through the $1500 an ounce level as traders anticipate a change in fed policy in the latter half of this year.
Inflation Rises: Where does that leave Gold?
If the CPI and PPI numbers start to rise the next couple of months I anticipate further weakness in the Gold and Silver Markets. Could we see $1000 Gold before $2000? Actions speak louder than words, and if Peter Schiff is selling gold, then maybe you should too!