...in US, people are probably selling Gold thinking it is overvalued (disconnected with conventional wisdom of inverse correlation with stocks); they would buy Gold when tech loses its lustre.
...in China, people are buying Gold because they see their central bank shedding US Treasury for Gold and encouraged to buy precious metals.
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Gold rallied strongly again today, disregarding entirely the significant reversal seen on Friday.
How could anyone label an asset as "overbought" when positioning is still far from extreme levels?
Remember, central banks aren't accumulating the metal for a 20-30% return on investment.
Rather, these institutions are relatively indifferent to short-term price movements.
Wake me up when the general investor starts piling into gold as a better alternative to their traditional 60/40 portfolios, which I confidently believe will happen.
Meanwhile, the GLD ETF is still facing significant outflows on a 2-year basis of nearly 45%.
