Despite gains earlier this week for gold, it’s price is depressed and should be trading higher according to Todd ‘Bubba’ Horwitz.
“[Gold] should be a lot higher…we should be making new highs with the pressure on equities and what’s going on with the dollar,” said Todd ‘Bubba’ Horwitz of bubbatrading.com.
Looking forward on equity markets, Horwitz said that investors should expect more volatility going forward.
“I think the market is going to be really volatile, I think this is going to be a volatile year…I think there’s going to be a big haircut coming in the markets, which means I think there’s going to be a bid for gold at some point,” he said.
Horwitz explained that gold has already priced in a higher dollar, therefore a rise in the dollar shouldn’t affect gold for now. “I look for equities to go lower, interest rates to go higher, and I think gold will then find a bid.”
Gold continues to offer good returns for long-term investors, but is also a good hedge during bad economic times and it tends to rise when the dollar is weak, so if your investment portfolio has a risk to the dollar’s downside, a position in gold may hedge that risk. Investors who are interested in owning gold may consider buying shares in a gold exchange traded fund(ETF). Here are a few ETF’s that follow gold prices: GLD, IAU, SGOL, DGL & OUNZ