Gold bugs who stepped in to buy when prices were collapsing at the end of June have been handsomely rewarded for their faith. Since dipping below $1,200/oz on June 28th, the most precious of metals has shot nearly 20% to over $1,420 earlier this week.
With gold prices retreating by more than 1% early Thursday morning, Breakout spoke to optionMONSTER's Jon Najarian to see where he sees gold going now that it's reached the $1,425 price target he set on Breakout earlier this month.
"Gold was severely oversold at the end of Q2 (but), I believe it's getting overbought at this point," Najarian says in the attached clip. He's taken off half of his long play but is looking to sell the rest of his position either at $1,450 - $1,500, or "as soon as missiles fly in Syria."
Ah yes, Syria. Add gold to the long list of assets with prices rising and falling based on the political tensions in Syria. The conventional wisdom says to buy gold and oil when the headlines are scary. Oil has shot up and gold has dutifully done the same, despite the somewhat questionable fundamental argument for either commodity having anything to do with Syria.
After the run gold has had, the question for both traders and investors in gold isn't what pushed prices higher. Syria was a factor behind the move along with all kinds of other cross currents. The question for those looking to be long gold is whether or not some sort of resolution in Syria, good or bad, will give them a chance to buy at lower prices.
Najarian believes gold goes lower as soon if the U.S. and/or U.N. decides to strike Syria. What do you think? Tell us in the space below.
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