Shelley Goldberg, Columnist

Gold Is Bound to Disappoint the Bulls -- Again

Throw out all the fancy analysis and realize that gold is an emotional trade.

June 12, 2017 at 3:45 PM UTC

Shelley Goldberg is an investment adviser and environmental sustainability consultant. She has worked as a commodities strategist for Brevan Howard Asset Management and Roubini Global Economics.

Don't believe the hype.
Photographer: Andrey Rudakov

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Gold has been trending higher, and is again flirting with $1,300 per ounce. For traders, the question is whether to build their positions from here in anticipation of further gains, or is this just another teaser that presages yet another turn lower for the precious metal? The fundamentals might suggest the former, by traders would be well advised to expect the latter.

After breaking through a six-year downtrend line, gold rose last week to its highest level since Nov. 4, and is up an impressive 10.5 percent this year. There are a number of reasons why gold is in demand. For one, it's been known as an inflation hedge. And while there’s no real inflation to speak of at the moment, it’s more about expectations as evidenced by money flowing into U.S. Treasury Inflation-Protected Securities and other inflation-linked instruments.