Wednesday, January 18, 2006
Intraday and Sectorz : Gold stocks were due..
This blog has been documenting the recent turbulence in "momo" sectors. In this previous post, we hypothesized that gold stocks would see a correction sooner rather than later as a rolling pullback commenced late last week in all momentum driven stocks and sectors. We saw airlines taken down, semis whacked, internets drubbed and Japan smashed (JOF down close to 5 %). Only gold stood tall awaiting its turn.
Today, the metal itself is down close to 2 % while the Philadelphia Gold & Silver Index (XAU) is down more than 3%. Blue Chip gold stock Newmont Mining (NEM) is down a couple of percent after being down yesterday as well. Right now, the pullback has been of the relatively mild variety. After all, the fundamentals in favor of gold (Iran, Nigeria, Printing presses, Crude/gold ratio, etc.) are still intact.
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