For traders of precious metals, such as gold and silver, the dynamics of the markets is of great importance. Now, it appears that many are closely watching industry veteran, David Morgan, to see if he believes the recent spike in gold prices is an indicator of a positive breakout for the market.
Morgan, who is the founder of The Morgan Report, has become an expert at recognizing market trends and is highly respected in the gold communities. Speaking to an audience in a recent webinar, Morgan noted that while it appears promising that gold prices have surged, he is not yet convinced whether this is a true breakout or simply a temporary fake out.
Though Morgan refused to make a definitive call on the matter, he did express that there are two important key factors to consider, which can possibly provide further guidance. The first factor lies in the commitment of traders, which could indicate whether the breakout is real or largely driven by short-term speculators. The second factor is in the physical demand for gold – if the market sees increased buyers, then the market’s sentiment may shift from short term to long term.
Based on these factors, it appears that investors should continue to pay close attention to the gold market to see if the buyers remain committed to the market. This is especially true if the market sees the sustained higher prices, which Morgan believes will be the indication of a definitive breakout.
By taking into account this information, as well as Morgan’s own observations, investors will be prepared to make the most informed decision on the future of gold prices. However, it appears that only time will tell whether this recent rally is a true breakout or just a short-term fake-out.