Gold poised for big breakout amid looming economic downturn – precious metals expert
After the lengthy bear market, gold could pick up its bullish momentum again, according to VanEck International Investors Gold Fund manager Joe Foster who sees a coming breakout for the precious metal.
The prospects for beaten-down gold stocks are starting to look promising, he claims, citing geopolitical risk, uncertainty around the Trump presidency, and potential inflationary pressure.
“In the next year or two, we are going to be faced with an economic downturn and probably a general stock market downturn that will bring out a lot of the warts in the financial system — and that could propel gold much higher,” the internationally recognized expert told US weekly newspaper Barron’s.
He explained that gold, which is traditionally viewed as a safe-haven asset in times of economic weakness, should gain its shine again as the current economic cycle reaches its late stages and with expectations that the equity bull market is coming to an end.
Foster, who has a background as a geologist, has been managing the VanEck Gold Fund for two decades now. He has a solid track record of guiding the fund in outperforming its peers for the past five and 10-year periods.
The expert has suggested that the selling pressure characteristic of the “horrendous bear market from 2011 to 2015” is finally reaching a bottom. He added that he believes the selling pressure has diminished and that downside risk is now at a minimum.
Foster, who has seen plenty of ups and downs for the yellow metal, said recently gold hasn’t lost its luster in an age of cryptocurrencies and high-powered tech giants. He suggested it would test the $1,400 level in the second half of this year. The precious metal was trading at $1,293 per ounce on Tuesday.
For more stories on economy & finance visit RT's business section