Technical indicators are signalling a buy opportunity for gold on a short-term basis, said Frank Holmes, CEO of Global Investors, who recommend buying on the dip in today's environment.
Other factors also contribute to his positive assessment of the yellow metal, including strong PMI data from China, which could signal good jewelry demand, as well as Venezuela's gold dump worth around $400 million.
"On a daily basis, in the past couple of days, it's a very attractive buy, you've got to buy when these countries are finally liquidating their assets before there's a change in government, and that's positive for the gold market," Holmes told Kitco News.
The central bank of Venezuela had recently sold $400 million worth of its gold reserves, but Holmes said this is not indicative of where gold prices are headed."[Venezuela] has been in a trend to liquidate anything with U.S. dollars. They're desperate," he said. "Classic case study in modern day economics of socialism's failure, tragic for all the great Venezuelan people, and the only thing they have is gold."