The surging price of gold has been a major story in the financial sector so far in 2016, but some believe the peak has been reached, or will be soon.
Reuters reported from London on March 16 that the price of gold dropped for the fourth straight day, ahead of an announcement by the U.S. Federal Reserve later on March 16 regarding interest rates.
The price of gold has posted a sizable increase in 2016, according to Kitco. It began the year at $1,082.25 per ounce and ended the day March 15 at $1,232 per ounce. The high point for the price of gold was the $1,277.50 per ounce close recorded March 4.
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Bloomberg Intelligence's Ken Hoffman explains that an increase in the Federal Reserve's interest rates would not be good for gold, as such increases boost the value of the dollar. While the Fed is not expected to announce an interest rate raise on March 16, as USA Today reports, it is expected to support the idea of continuing to raise the rate slowly over time, which won't help the price of gold.
Wayne Gordon, commodity and currency strategist at UBS Wealth Management, wrote in a commentary on CNBC's website that his company is advising investors to reduce their gold holdings if the price approaches $1,310, and increase holdings if it goes back down to $1,100.
He says that, at the current price of gold, it's too late to jump on the bandwagon in hopes of buying gold at a low point.
"We expect the price trend to reverse if U.S. economic data improves," Gordon wrote. "Stronger U.S. data should allow the Federal Reserve to normalize monetary policy further and earlier than currently predicted by federal funds futures."
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Oppenheimer technical analyst Ari Wald was quoted by CNBC as saying, "It's time to take profits in gold."