Trade view /
23 August 2016 at 11:43 GMT
The US labour market is also close to full employment, so further inflationary pressures should be on the horizon.
In addition, employment growth looks robust and the US stock market is close to all-time highs. If this theme plays out as we think it will, it spells short-term opportunities on the short side in gold miners.
As a result we are initiating a short position in gold miners through the most liquid ETF – VanEck Vectors Gold Miners ETF (GDX:arcx).
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Source: Saxo Bank
Gold has gained strength this year as investors sought protection against correlated assets but also as the ultimate safe-haven against what looks like extended valuation across many different asset classes.
But a strong underlying force among investors is the hunt for yields, which could again hurt gold as the asset has a negative carry dragging down portfolios with already low indicated yields.
Entry: sell at market.
— Edited by Michael McKenna
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