After trading as high as $1358.00 on September 8th, the spot gold price has dropped close to 6% posting a low of $1277.00 during last night’s London session.
Several global-macro reports suggest that higher US interest rates combined with a stronger US Dollar were primary drivers of the yellow metal’s move lower.
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However, daily charts show that in the lead up to Chinese Golden Week, the price of spot gold has dropped between 5% and 8% every year for the past four years.
In each of those years, the Spot price rebounded to make new highs over the course of October.
On September 20th, we posted that Newcrest Mining was a reasonable buy in the $21.80 range.
Looking forward, we expect the $21.00 area to offer good support for a move back into the $24.00 area into the end of the year.
Newcrest Mining
