Widely followed market commentator Dennis Gartman appeared on CNBC's Squawk Box this morning. He had an interesting take on the gold market (according to cnbc.com):
While not being comfortable with the current gold trade, Dennis Gartman, founder of The Gartman Letter, told CNBC Monday that the price of the precious metal will "continue to go up until it stops."
"It is a gold bubble," Gartman told CNBC. He called the trade on gold "mind boggling," but also said he is currently long — or betting gold will go higher.
Gold hit a fresh record high above $1,130 an ounce early Monday as the dollar fell against other Western currencies. Gold's Friday low of $1,102 an ounce is the floor, according to Gartman. If it falls below that mark, he suggests investors should "head to the sidelines."
Though "gold is in a bubble...but by it..." seems contradictory, the fact that the gold market might be in a bubble (and other commodities, too) does not mean it has to pop anytime soon. Indeed, the bubble could continue to inflate for months. Gartman identifies his stop and is content to trade with the momentum until the trade no longer works.
