“Seemingly surprise” to everybody, the biggest drop in gold prices since 1983 happened this week. The price of gold bullion posted its biggest one-day decline on record, falling more than $125 an ounce on Monday. The price of gold has crashed! It crashed from $1,565 to $1,355 from the close April 11 to the low April 16, that is whopping 14%!
Wow, what a big news! and the best part is, there is no consensus why this has happened.
For the whole week, you must be flooded by the news and commentaries of speculations of why it crashed, what is the impact to the world like China and India, you and me. The gold bull is over, the gold is at good price to buy, the jewellery shops lost millions of dollars, people flocking to gold smith to buy gold bar at bargain price, etc etc. You must be searching for a reason or what to do about this Gold thingy, maybe that is why you landed on my blog.
But here is the thing. Isn’t this just like another trading day for any investment? isn’t any investment supposed to go up and down? What is a big deal?
It seems people have forgotten “Gold biggest three-day slump since October 2008” in 2011 Aug. Take a snap shot of 5 year Spdr Gold shares (GLD) chart as below, does this “crash” really look that big? I’d rather think that the end of 2008 market is more volatile.
These buzzes on Gold just like any other noises in the market. Check out my previous blog articles, remember the “The sure win schemes investing in Gold” are all under investigation now? Remember some analysts’ call that gold would go up to US$2,500 in 2011? Now the Gold is only nearly half of what they have predicted.
You don’t have to take my word, but trust Goldman Sachs! Goldman Sachs cut its gold-price view two days ahead of the start of the biggest decline in three decades. On April 10, Goldman has already cut its 2013 gold forecast from $1,610 to $1,545 an ounce and its 2014 forecasts from $1,490 to $1,350. That is why I used the word “seemingly surprise to everybody” in the beginning. “Goldman Sachs rules the world” again?