ETFs are Making ‘Record Purchases’ of the Precious Yellow Metal


Thursday, Gold prices spiked after the Trump Fed announced a $2.3-B ‘Big Bang’ lending program to cushion Main Street from disruptions caused by the COVID-19 coronavirus.

Gold futures for April delivery climbed 4.25% to over 1,736.20 oz to close at their highest mark since December 2012.

In the last 6 wks there have huge central bank injections of cash into the economies and that is very good for gold.

Over that frame, the Fed and the US Treasury have taken unprecedented measures as to slow the spread of COVID-19 has brought the US economy to a near standstill and a 41 state lockdown.

Aside from slashing interest rates to Zero, it stepped up and agreed to buy an unlimited amount of Treasury securities and launched a number of lending facilities to ensure financial markets function properly.

The Fed’s action has caused huge demand for gold.

There is tightness in the gold market as physical retail purchases are happening at a pace not seen in a very long time and the ETFs (exchange-traded funds) are making record purchases of gold.

Gold SPDR (GLD) is the biggest ETF in the sector and we have it as Very Bullish across the board.

With Wall Street strategists forecasting for higher gold prices, the rally in the gold miners may just be getting started.

In a note to clients in March, a Deutsche Bank analyst said his firm has a year end forecast of 1,800 oz.

Our model shows that for every $100 gainer in the price of gold, that Barrick (NYSE:GOLD) shares will by 16% and Newmont (NYSE:NEM) stock will climb by 13%. Our overall technical outlook is Very Bullish and Bullish respectively with strong support and little to no overhead resistance in here.

We here at HeffX-LTN see gold in a long-term uptrend that began on 11 December 2019.

Have a happy healthy Easter and Passover weekend, stay at home, Keep the Faith!