“I have been bullish on gold as well as gold stocks for the past year,” Michael said.
“Despite the gold price making new highs recently, I believe that it can continue to head higher due to three main factors: central bank buying, interest rate cuts, and a falling US dollar.
“The chart of gold has been trading very well and it also indicates that this current move higher is sustainable and should continue for a while yet.
“Gold finally broke above a long-term resistance line earlier this year and rallied hard by nearly US$300.
“We can see that in April, the price then started to consolidate sideways in a range between about US$2280 and US$2430.
“This was a healthy consolidation, and it merely set it up for the next move higher.
“It has now finally broken higher in a convincing way (circled in the chart below).
“This is a new buying opportunity for Gold, and we expect another multi-month rally from here.
“Investors can consider buying a gold stock such as NEM, RSG, PRU, or NST, or a gold ETF such as GOLD,” Michael said.
Michael Gable is managing director of Fairmont Equities. Any advice is general only.
GOLD
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