Gold's Weakness Suggests Investors Continuing To Raise Liquidity

(Kitco News) - Gold continues to experience pressure as investors generateliquidity in the wake of the global equity shakeout. The bounce in equityvaluations yesterday was actually a negative for gold prices, as investors assumedthe recent drop was merely a retracement, as with past sell-offs, and jumpedback into the equity space. Gold, a proxyfor liquidity, came under selling pressureas investors raised cash to average into the equity trade. The dollar hasgained, as foreign investors also piled into yesterday's open swoon, on theindexes. The volatility in the equity space is not over and gold remains aviable hedge. Technically, gold needs to hold the $1,320area with $1,332 a target for a break higher.

By Peter Hug

Contributing tokitco.com

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