Gold bugs are back ... sort ofMarch 18, 2013: 1:23 PM ET
Gold is making a comeback, at least for today.
The precious metal shot above $1,600 an ounce Monday, as rattled investors looked for safe spots to park off while Cyprus sorts out its banking issues. Over the weekend, it seemed like the tiny nation was going to get its 10 billion euro bailout and it would be business as usual.
But then the strings were attached, in the form of a tax on all bank deposits. That caused Cypriots to swarm ATM's in an effort to pull their money out before the tax went into effect.
Banks will stay closed through Wednesday and the Cypriot Parliament won't take up the bailout issue until Tuesday at the earliest.
The proposed move sparked fear around global markets, sparking a sell-off in European and Asian stocks. The euro fell as low as $1.288 -- its lowest since November.
In turn, gold drew buyers. Gold had already started to trend higher before worries about Europe reared their ugly head. But $1,600 still appears to be a resistance point for investors.
All of that provided fodder for StockTwits traders Monday.
Well, really, anything is possible. But gold has been tried and true as a safety play time and time again. One thing to note here. Gold is up but it's not in a sky-high rally, which suggests to me, at least, that there are some skeptics out there.
Thank you RyanDetrick for proving my point. Only 43% bulls mean the rest are more bearish.
It was a mover. For now, gold seems to be holding steady right around $1,600.
Exactly! That's probably why we're seeing gold back off its earlier high.
Stocks have also started to bounce back as everyone decides it may be a little too early to call an end to the rally. Remember that the Dow has just come off its best winning streak since 1996 and hit new records for 8 days in a row.