Gold was the beneficiary of a strong rally after the announcement of the open-ended QE3 that pledged to pump $40 billion/month into the economy. But after picking up some steam, the precious metal suffered a rough couple of weeks. October has historically been the worst month for gold over the last 15 years, and this year’s loss of nearly 3.5% for the four week period fell right in line with those expectations [for more gold news and analysis subscribe to our free newsletter].
Now that gold is seemingly correcting, many investors are wondering if the hard asset is at a bargaining point. Peter Schiff seems to think so. The renown investor recently said that “one day we’re going to look back at $1,700 with nostalgia. People are going to be shocked at how inexpensive gold was when it could be snapped up for such a bargain price.” Schiff has been urging investors to buy this commodity for quite some time, as he feels that the next few years could watch it soar to over $5,000 per ounce.
With analysts calling for a recession next year, inflationary fears and constant dollar debasement, this commodity certainly has a lot going for it. So for those of you who fall under the umbrella of general gold bullishness, the only question you need to answer is when you think a buying opportunity presents itself. Looking back at historical trends, gold has been very strong between November and February, but the precious metal has stumbled out of the gate this month thanks to a stellar jobs report [see alsoInvesting In Gold: The Definitive Guide].
Below, we outline three ways to make a play on gold as the commodity continues to correct.
This article was originally written by Jared Cummans, and posted on CommodityHQ.