Gold surged more than 2% for a second straight session this morning. It brushed briefly above $3,500 overnight, registering a gain of $300, or 9%, in just over a week.
Investors continue to turn to it as the ultimate haven amid all the ongoing market uncertainty. This latest push higher was driven by both Trump’s attacks on the Fed and the increasingly fragile outlook for the dollar.
As sentiment sours, gold continues to shine as the financial refuge of choice. But, there’s a big ‘but’. Gold is extremely overbought at current levels, and the move over the past week has the characteristics of a blow-off top.
Source: TN Trader
That’s not to say that gold is about to reverse course sharply. It may do, but another remedy to its currently overbought condition could be a protracted move sideways. Or, it could continue to shoot higher as more investors pile in, as the FOMO becomes too strong to resist.
Silver, however, remains stuck and continues to underperform relative to gold. Often, silver can come from nowhere and play catch-up with its more popular partner. But the fact that it is also a significant industrial metal may be a negative for many traders, as they assess the likelihood of a slowdown in global economic growth amid tariff uncertainty.
