The recent correction in gold prices is not unexpected. Gold prices have been on a strong upward track for some time. When you look at any trend line and see straight up price growth it is only a matter of time before people who purchased at a lower price take profits. Does this mean that the gold rally is at an end or is this simply a buying opportunity? Here are some of the facts that can help you answer that question.
Have the reasons for gold investment changed?
In a word, not much has changed in the economic and political picture. The debt crisis in Europe and the US is still in full force. The problems are not resolved and there are no solutions, only delays. Time will tell if the various countries can find ways to balance their budgets and pay their debt, but they certainly have not done it yet.
Are people dumping their gold?
Again, the answer is no. Some people are taking profits, which is a smart strategy for people who have significant profits. The old adage that “you never lose money taking a profit” is so true. People who got in early have profits of 100% or more and are likely selling only part of their gold holdings.
Is this a gold buying opportunity?
If you compare today’s gold prices to those we saw in the 1980s, the most recent time when we saw significant gold appreciation, an inflation adjust price for today’s gold would be $2400 a troy ounce. Analysts are still projecting gold prices up to $2500 or more per troy ounce this year. Given that perspective, this is likely a gold buying opportunity and gold will continue on its upward path very soon.
It is easy to buy gold
There are a number of gold bullion coins that are readily available and can be purchased quickly and conveniently from trusted sources such as APMEX and BullionVault. You can make a range of investment based on the size of the gold bullion coins, which come in 1/20th, 1/10th, ¼ and 1 troy ounce for most of the coins. The most popular gold bullion coin is the Gold American Eagle but you can also buy Canadian Maple Leaf, Chinese Gold Panda, a variety of Australian Gold bullion coins, European bullion, Mexican Pesos and South African Krugerrand. Check into the available gold bullion coins and get your safe haven investment.