Billionaire John Paulson, who lost over $700 million after April’s gold crash, has cut his holdings by half. As one of the last major institutional holders of gold ETFs, Paulson & Co.’s exit may signal the bottom in the gold market we’ve been waiting for.
Two major institutional players also give us reason to be enthusiastic. JP Morgan is advising its customers to go long on gold “with a four-five week time horizon,” citing further supply squeezing in South Africa and seasonal pickup in India:
“Gold supplies could be constrained in September if labor strikes are initiated in South Africa. There’s typically some positive seasonality to the gold price in August/September helped by India, which is still the largest single (28%) gold market.
“Often this strength correlates with the Denver gold conference. The conference attracts many of the larger gold investors, and given the other positives for the metal… we would not be surprised to see a stronger gold price in the run-up to the show.
“We’d encourage shorter-term investors to consider getting long the gold space with a four-five week time horizon.”
Read More at The Daily Reckoning . By Jason Farrell.