Yahoo Finance

Well, gold extending its record high surging to another new high, higher highs if you will, as investors weigh concerns over President Trump's criticism of the Fed and the escalating global trade war. Yahoo Finance's Josh Lipton is here now with more on what investors need to know about these new highs in gold.

That's right, Brad. So, we all know there has been a lot of drama and volatility in the stock market this year, but one asset that continues to shine, that would be gold. The yellow metal has glittered, hitting successive records this year, surging some 30%. Investors have piled into the safe haven amid these volatile markets and uncertain economic backdrop. In fact, according to the latest Bank of America fund managers survey, gold has surpassed the magnificent seven tech stocks as the most crowded trade on Wall Street. And about 42% of fund managers expect gold will be the best performing asset of 2025. That is up from 23% back in March. Ed Yardani of Yardani Research notes that central banks around the world have been increasing the percentage of their international reserves held in gold since early 2022. Now he's been bullish on gold since it broke out above 2000 at the end of February 2024. His target by the end of this year, 4,000. And if that happens, then 5,000 would be his target for the end of 2026. Still, others on Yahoo Finance tell us they have become more cautious on bullion after this strong run, saying at least in the near term, investors might want to be more tactical in their timing before jumping in here.

I have made the argument for the last several weeks that if we are in the early stages of what could be multiple pulses of margin calls given the volatility that we're seeing in stocks, it is only a matter of time until gold becomes the source of liquidity to cover those margin calls. There's a very specific reason for that. In behavioral finance, there's something called the disposition effect, which means that people tend to sell their winners before they sell their losers. Well, guess what, folks? Gold is one of the few winners left now.

For a technical take on gold, I also reached out to Mark Newton over at Fundstrat. Now he argues gold does remain attractive technically, despite being overbought, expects a short-term rise to continue up to near 3450 to 3585 before this begins to consolidate, likely from May into July. One wants to see gold make a new monthly low at a minimum, he says, before deciding to avoid it or at least a move to multi-week lows under 2956, he says, will turn on warning lights about the potential for deterioration. He expects gold to continue higher into the seasonally positive time in the fall with August to October likely be bullish before peak and turn back lower. Bottom line, Newton says, it's still quite likely that gold can move make further gains in 2025, Brad.

All right. We're going to continue to track that. We knew you would, too. Josh, thanks so much.