The Case For Ditching Stocks And Buying Gold In 2014

Gold Swings Near Three-Week High as Asian Demand Seen Increasing

I I think the exit is going to be extremely messy. Therefore, in my opinion, gold is a place to hide throughout that quote-unquote 'messiness,' " Boockvar said. Meanwhile, Boockvar says that QE has been a "crutch" for stocks, adding that "the big crutch in 2013 potentially is not going to be there in 2014." Getty Images When looking to catalysts that could drive gold higher, some traders add that the metal has become so beaten down, it could now be a bargain. "In 2011, gold had this $400 range on the upside, and as soon as it broke $1,525, that became an inflection point," said Brian Stutland of the Stutland Volatility Group. "So I'd expect another $400 drop below that pointthat would take us to $1,125. We're not too much off there, so the bottom is probably near." "If you look at the gold miners themselves, we're getting to the point where it's not very profitable to mine gold," said Anthony Grisanti of GRZ Energy.

EST on Monday morning, before regaining nearly all of that drop within the same minute. The swift move triggered a 10-second pause in trading, and many market participants said a single trading error was probably to blame. "What has a tendency to happen if someone does a fat finger trade is that it triggers stops that people leave in," said Matthew Hoverman, senior trader at Grafite Capital. "There is a high likelihood that that's what happened today." Auscape | UIG | Getty Images When traders buy gold (or any other futures contract) they often do so with a "stop-loss order," which limits the amount of money that can be lost by automatically selling out of a long position when gold trades down to certain level. This can compound swift moves, because an initial sale executed poorly or in error sends the market lower, triggering stop losses, which generates more selling, and in turn triggers more stop losses. This snowball effect explains why the gold market can drop some 2.5 percent in seconds, as it did on Monday morning.

Time to Buy the Hated Gold?

Gold's prospects don't look good going into the New Year, either. Price inflation has only appeared in the cost of food, health care and education. While those are real expenses for everyone, headline CPI will just continue to limp along below 2%. If and when CPI click here for mike dillard the elevation group reviews begins to go up, whether because of Fed policy or anything else, then this would be a positive catalyst for gold.

Sudden gold plunge has traders looking for answers

16. Gold for February delivery rose 0.3 percent to $1,241.70 on the Comex after dropping yesterday by more than $30 in about a minute to a low of $1,212.60, spurring a 10-second trading halt. Gold tumbled 28 percent last year, the most since 1981, as some investors lost faith in the metal as a store of value amid an equity rally and muted inflation. The Federal Reserve on Dec. 18 said it would reduce its monthly U.S. bond purchases to $75 billion from $85 billion, with minutes of the meeting to be released this week.