Two ETFs On My Monthly Buy List

Two ETFs On My Monthly Buy List

In last weekend's article, I discussed the two stocks that I liked the most after my end-of-month scan of the market. Of course, I run the same scan on a large group of ETFs that I follow. Positive monthly signals were observed in a number of gold-related ETFs, including the SPDR Gold Trust (GLD) and VanEck Vectors Gold Miners ETF (GDX). Many traders and investors believe that a weaker dollar is always associated with higher gold prices, but there have also been periods when they moved in the same direction. This impression stems in large part from the early 1980's. The dollar formed a major bottom in the fall of 1980, with the election of Ronald Reagan, and Gold had peaked in January of 1980 at $850 per ounce. The US dollar rally lasted until 1985 and the Plaza Accord, at which point the dollar was devalued. In July 2001, the dollar topped at 121. 21 (point a) and then started a multi-year decline. By April 2008 had fallen to a low of 73. 71 (point b), which was a decline of just over 39%. During the same period gold rallied from a low of $258 per ounce to $956.