“GLD Hitting Its Stride as Seasonality and Fundamentals Come Together

There has been a lot of talk lately about Seasonality and Fundamentals converging on Gold, otherwise known as GLD. The gold-backed exchange-traded fund (ETF) has seen a tremendous amount of interest over the last couple of months. It has risen significantly since the middle of December 2017 due to several factors. These factors include increased seasonal demand for gold, decreased U.S. Dollar strength, and rising geopolitical tensions in North Korea, to name a few. Seasonality has played a major role in the rise of GLD, as the fund typically rises in late December and January due to safe-haven investments during this time of the holiday season. With North Korean tensions boiling and uncertainty in the global geopolitical climate, investors have been leaning towards the security of Gold to protect their investments from potential losses. This has driven a strong rally in the GLD since the middle of December, with the ETF currently hovering around 130 points. At the same time, fundamentals have also had a strong impact on the GLD. After a lagging global economic outlook in the third quarter of 2017, investors have been leaning towards commodities to protect their investments from market volatility. With the strong U.S. Dollar falling in value, gold prices have received a slight boost, although not as strong as some had previously expected. Nevertheless, with increased demand for gold in the form of jewelry and industrial use, the GLD has been able to maintain this growth. Overall, Seasonality and Fundamentals have clearly played a major role in the rise of the GLD over the last couple of months. With safe-haven investing, geopolitical tensions, sliding U.S. Dollar, and higher demand for gold driving the ETF, the GLD looks to continue its strong performance and is certainly one to watch.