Gold's Promise: Keep Rising Amid Sell-Off Risks, Says Mike McGlone
Gold's Potential Amid Economic Turmoil
The markets are reacting to the Federal Reserve's anticipated interest rate cut on September 18, leading to sell-the-fact risks. Gold is anticipated to solidify its position, while stocks struggle and other commodities may decline.
Mike McGlone's Insights on Commodities
Mike McGlone, senior commodity strategist at Bloomberg, commented on September 19 about the crocodile jaws chart pattern visible on a 24-year graph. This chart illustrates a divergence between the S&P 500 and Bloomberg's commodity spot indexes, predicting that gold could induce an upswing in the commodities index to align with stock indices.
- Increased sell-the-fact risks emerge from anticipated Federal Reserve easing, implying a bullish outlook for gold, while commodities may see declines.
- McGlone’s view stresses the burden on the U.S. stock market to avoid deflationary pressures caused by plummeting material prices.
Gold Price poised for Growth
As of now, the price of gold stands at $2,608.72 per ounce, near its all-time high of $2,612.71. This precious metal is traditionally viewed as a safe haven in uncertain times, benefiting significantly from a climate of increasing recession fears and a dovish monetary policy by the Federal Reserve.
- Current Trend: The recent 50 basis points rate cut hints at a possible recession, highlighting gold's resilience during economic downturns.
- Market Predictions: Analysts predict that the reaction of the stock market in the coming weeks will be critical in determining recession outcomes.
- AI Forecast: An AI model forecasts gold prices may reach approximately $3,000 per ounce by the end of 2024.
Investing remains speculative; capital is at risk. The content should not be viewed as investment advice.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.