Gold's Groundhog Day Rally May Help Platinum

KITCO NEWS - Groundhog Day may prove to bring six more weeks of winter to the United States, but the outlook may be a little brighter for gold. "Gold may be running into a perfect storm," says Bloomberg Intelligence's Mike McGlone. "The VIX [Volatility Index] is at two-year lows, which also paints a good scenario for gold," he told Daniela Cambone Thursday as the yellow metal rallied to multi-month highs. April Comex gold futures settled the day at $1,219.40 an ounce, up 0.92% on the day. McGlone explains that the low volatility index could only mean that it will have to move higher. "So if the VIX goes higher, we generally know that mean higher volatility, lower stocks and higher gold." However, it is really platinum that is on McGlone's radar, who says the metal is likely to benefit from increased demand.

This article is commentary by an independent contributor. At the time of publication, the author held TK positions in the stocks mentioned.