Top gold ETF setting the price agenda

Those analysing gold supply and demand will point to a big fall this year in Asian demand, notably in India and China which may have more than countered the rise in the gold ETFs. But it is still investment demand in the West, and in the US in particular, which appears to have most relevance in terms of gold price setting. It should be recognised that during the period when the gold price was falling sharply, Asian gold demand was at huge new record levels, but had little impact in terms of halting the price decline. At best it may have slowed the rate and depth of the gold price fall a little. So it is now, but in reverse. Rises or falls in gold ETFs are currently usually precursors of similar rises or falls in the gold price on a day to day basis. Others may step in and try and control these given potential losses on short or long calls in gold, but overall the big gold ETFs are setting the price agenda , and GLD as the biggest of all is particularly relevant here. As we said at the beginning, but in reverse order, follow GLD and you’ll likely be following the direction of the next moves, positive or negative, in the gold price.

Top gold ETF setting the price agenda