Gold gives back portion of yesterday’s solid gains, Morgan Stanley sees ‘pockets of bearishness among the wealthy’ – shifting from equities to cash

(USAGOLD – 4/22/2021) – Gold gave back a minor portion of yesterday’s solid gains in early trading even as yields and the dollar edged lower. It is down $6 at $1789. Silver is down 21¢ at $26.42. Assessing gold’s prospects in an Investing.com article, OANDA research analyst Ed Moya says, “Gold’s next barrier is the $1,800 level. Once prices capture that level, momentum traders could ride this wave towards the $1850 level…[The metal’s] outlook is becoming very bullish as too many risks are percolating globally. The virus spread across Asia* is weighing on sentiment…Market positioning across equities and fixed income could lead to massive inflows for bullion. Even in the U.S., calls for caution are growing for U.S. equities as some analysts are eyeing a potential 10% pullback.” Along these lines, CNBC reported yesterday that a recent Morgan Stanley survey found sentiment shifting among investors with $1 million or more in brokerage accounts. Though the majority remains bullish on stocks, it says, “pockets of bearishness are rising among the wealthy” concerned about “the market, inflation, and Fed policy, as well as a major decline in bullishness on the tech sector.” That group has begun shifting capital from equities to cash, according to the survey.

* Recent outbreaks in India and Japan

Chart of the Day

The Goldman Sachs Commodity Index and Gold
(Percent gain or loss year to date, 2021)

overlay line chart showing the GSCI and gold year to date

Chart courtesy of TradingView.com • • • Click to enlarge

Chart note: When you consider that the Goldman Sachs Commodities Index is up almost 22% since the beginning of the year, it gives cause to think that gold – often cited as the king of commodities – might be lagging and due for a rally. It is down almost 7% on the year. Goldman Sachs, among others, is calling for a commodities supercycle that could last for many years.

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