Profit-taking hits gold

The price of gold is off nearly 1% as traders lock in their profits from the recent rally.

Gold enjoyed a good bull run over the past month, as the Federal Reserve’s loose monetary policy gave traders a reason to buy the precious metal. Gold has made advances in the past four trading sessions, but today dealers decided to close out their long positions and secure their profits. Even though gold is in a clear upward trend, traders sold the precious metal as no market moves in a straight line – you often see corrections from time to time.

In recent years, investors have been gaining exposure to the price of gold through exchange traded funds (ETFs), which are investment funds that invest in the precious metal. Traditionally the gold market has been traded by long-term investors, but nowadays more short speculators have entered the market. SPDR Gold Trust, the largest gold ETF in the world, announced a large disposal of physical gold yesterday. Smaller traders then started to dump their gold positions for fear that other funds could unwind their positions in the market.

Spot gold chart

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen. 79% van de retailbeleggers lijdt verlies op de handel in CFD’s met deze aanbieder.
Het is belangrijk dat u goed begrijpt hoe CFD's werken en dat u nagaat of u zich het hoge risico op verlies kunt permitteren.
CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen.