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Now is the time to build a small position in gold even though prices may be falling – Carley Garner of DeCarley Trading

Now is the time to build a small position in gold even though prices may be falling – Carley Garner of DeCarley Trading

Now is the time to build a small position in gold even though prices may be falling – Carley Garner of DeCarley Trading

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(Kitco News) – The gold the market remains stuck in neutral, above $1,750 an ounce, while waiting for a new catalyst; however, one market strategist says that instead of trying to time the market, investors should recognize that current prices represent long-term value.

In an interview with Kitco News, Garley Garner, co-founder of brokerage firm DeCarley Trading, said investors can start dipping their toes into the market and building small positions to take advantage of the upside potential.

“To be honest, I’d like to see it gold in the new year prices drop a bit to get a better price, but this is not a bad place to start buying small positions,” he said.

He added that in today’s market conditions, micro-gold contracts are attractive. Mirco futures trade like regular CME contracts, but only for 10 ounces goldone tenth of a traditional contract.

10 cents in a microcontract represents $1 in profit or loss.

“You’re not going to get rich, but it’s a good way to dip your toe into the market and build a position by limiting risk,” he said.

Another way to gain exposure to the precious metal is through equity silver. Garner said it’s even more attractive than the silver setupsilver gold. Comments come as follows silver prices sell for more than $21 an ounce. November has been an unusual month silver as prices rose by more than 20% compared to October’s lows.

“We saw the price of silver break the downtrend in early November and since then, it has come back to hold support,” Garner said. “I like the idea of ​​buying silver dips as long as the price is above $20.50 an ounce. If it breaks below that level, all bets are off. That’s my line in the sand.”

While the potential in the precious metals market is growing, it still lacks a catalyst to ignite the next move higher. However, Garner said he continues to watch the US dollar. He explained that the US dollar index is above a crucial technical pivot at 106 points.

A drop below that level would give him a breather gold and silverhe said



“If we break below 106, then I’m looking [U.S. dollar Index] to test support in ’98,” he said. “There was a lot of panic money going into the US dollar this year, and we’re starting to see that slow. If we see that move, and I think we will, that loosens the plow from gold and silver and lets those two run higher.”

Many analysts have noted that the US dollar continues to be supported by the Federal Reserve’s aggressive rate hikes. While markets expect the US central bank to slow the pace of rate hikes, the projected terminal rate remains above 5%.

While interest rates may rise from current levels, Garner said he believes much of this move is already priced into the U.S. dollar. He added that the Federal Reserve will not be able to keep interest rates higher when it becomes clear that the economy has entered a recession.

“Honestly, I think we’re in a recession, and that’s going to be for the best goldespecially as inflation remains higher than expected,” he said.



Note: The opinions expressed in this article are those of the author and may not necessarily reflect his own Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee this accuracy. This article is for informational purposes only. It is not a request to exchange commodities, securities or other financial instruments. Neither Kitco Metals Inc. nor the author of this article accepts any loss and/or damage resulting from the use of this publication.

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