Over the last six months, gold has been on an upward trajectory, registering fresh all-time highs nearly every month. However, the yellow metal’s price has faced some resistance since hitting US$2,670 on October 1, driving it as low as US$2,639.
Hemke explained in the October 3 interview that this is likely the result of the market testing resistance at the US$2,650 level.
‘We’re pulling back and testing that level of support,” he said.
“Technical analysis when you’re in this area of new all-time highs is pretty tough to do. It doesn’t surprise me that we’ve kind of paused here, but things could change pretty rapidly, both economically and geopolitically, in the next few days.”
Because of these numerous global and national challenges, Hemke believes “all bets are off” as to where and how much further gold’s price run could take it.
He also touched on silver’s inability to make the 30 percent gains its sister metal has displayed this year, and the under performance of mining shares.
“Probably the most frustrating thing for a lot of investors is silver is (just) kind of playing along, and the mining shares are playing along even less than silver is,” he said.
On the topic of when miners could catch up, Hemke discussed the surprising correlation between the price of silver and the value of the VanEck Gold Miners ETF (ARCA:GDX).
‘Gold keeps going. Silver will eventually move as well. And when silver moves, the mining shares will move. Strange as that may sound,’ he said.
Watch the interview above for more from Hemke on gold and silver.
Interview by Charlotte McLeod. Article by Georgia Williams.
Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.