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JPMorgan Recommends Buying Gold

Statement from JPMorgan, “We’d encourage shorter-term investors to consider getting long the gold space with a four to five week time horizon”. Yesterday I alluded to the fact that many hedge fund managers are cutting their gold holdings, while today JPMorgan Chase & Co(NYSE:JPM) is recommending clients to buy
gold. According to the bank, there are several bullish headwinds trending in the direction of the metal. First, worldwide demand for gold, which is driven by China and India are maintaining strong levels according to the according to The World Gold Council. Second, potential strikes next month by gold miners in South Africa could disrupt supply and cause a surge in demand.

I think this is just an attempt by JPMorgan to increase the value of gold because according to current reports the bank is buying large quantities of gold to meet delivery demands. The call is nothing more than price manipulation. I’m sticking with my call yesterday, bearish on gold long term.