UNITED STATES June 09 2017 10:30 AM
NEW YORK (Scrap Register): The macroeconomic forces justify the strength in gold since mid-May. “In particular, lower rates, weaker dollar and broader uncertainty provide a good foundation for the market to continue its journey higher, said UBS in a snippet.
The uncertainties include central-bank meetings and global political risks, UBS explains. “We've argued gold's role as a diversifier in investor portfolios, and this is becoming increasingly relevant in the current environment.”
Despite the rally from the lows printed in May, we think gold positioning is not crowded overall and there should be room for the move to extend.
While a pause is understandable around key resistance levels and ahead of key events in the near term, UBS thinks the market should stay supported overall and would view dips as an opportunity to build/add to positions.