In This Article:
Uncertainty & Instability: Gold’s Best Friend
Until recently, gold had underperformed equities and most other asset classes for years. However, as equity markets languish, trade wars arise, and macroeconomic uncertainty proliferates, the shiny rock is doing what it does best – acting as a safe-haven asset. Years of rampant money printing and a near-zero interest rate policy (ZIRP) have been unable to spark gold. That said, President Donald Trump’s bold, risky, and ever-evolving tariff policy has sparked intense rhetoric and an all-out trade war between the world’s two largest economies – the United States. Between the policy uncertaint, drastic economic changes, supply chain uncertainty, and increasingly hot rhetoric, gold has finally got its mojo back. After over a decade of sideways and choppy price action, gold and the SPDR Gold Trust ETF (GLD) broke out of a massive cup-with-handle base structure early last year and never looked back.
Image Source: TradingView
As the old Wall Street adage goes, “There’s always a bull market somewhere.” In 2025, that bull market exists in gold. Year-to-date, gold is up more than 28%, outperforming the S&P 500 Index by a whopping 42.5%.
Gold Proves its Safe-Haven Status
For thousands of years, gold has proven itself as a form of wealth, a medium of exchange, and a safe-haven asset. While countless fiat currencies have lost value due to government corruption or lack of scarcity, gold’s unique physical properties, applications, and reputation have helped it to stand the test of time. Even when compared to silver, GLD’s 2025 performance is more than double that of the iShares Silver ETF Trust (SLV). Meanwhile, the MicroSec Gold 3x (GDXU) gold miners ETF is the best-performing ETF thus far in 2025 and is up 180%!
Should you Buy Gold Now?
While it can be prudent for investors of all kinds to hold a portion of their net worth in gold as a hedge in perpetuity, timing buys properly is still critical to success. For example, it took investors who bought gold near the top in August 2011 nearly a decade to break even.
Below are two reasons that now is not the time to be chasing gold:
1. Gold is 25% above its 200-day moving average: Moving averages act like a rubber band for stocks – when they get too stretched from the moving average, they often snap back in the opposite direction. Gold is currently 25% above its 200-day moving average. Historically, short-term returns have been poor when this level of extended price action occurs.
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