Top Stories This Week: Gold Price Correction Still “Healthy,” Biden Coming for Copper

The gold price spent time below the US$1,700 per ounce mark this week, but was trading higher at the time of this writing on Friday (April 2) morning, around US$1,730.

Market watchers have blamed the yellow metal’s decline on many of the usual suspects, including a stronger US dollar and better 10 year Treasury yields, which rose as high as 1.745 percent this week.

With Q1 at an end, I thought it would be fun to take a look back at two of our previous polls, where we asked our Twitter followers where they thought gold and silver would be by the end of the quarter.

Were they correct? Unfortunately, in both cases the people who gave low price targets ended up being right — it’s safe to say that gold spent the last three months trending down, and it was the same story for silver, although the white metal has seen a less pronounced downward trend.

Of course, as gold commentators have said repeatedly this year, and really since the yellow metal’s price began to drop off after last summer’s all-time high, lower prices aren’t necessarily cause for concern.

I had the chance to speak this week with David Erfle of Junior Miner Junky, who described gold’s price activity since last summer as a “very healthy correction,” saying that if it had only corrected down to US$1,800 or US$1,900 there would have been problems later on.

“What we started was a very healthy correction. If we would have had just a correction down to maybe US$1,800, US$1,900 and then it took off again, then it would have been a problem later on because we would have had a strong correction” — David Erfle, Junior Miner Junky

We’ll be posting my interview with David next week, so stay tuned for that.

Moving on from precious metals, US President Joe Biden’s US$2 trillion American Jobs Plan brought base metals into focus this week. The massive proposal was introduced after the administration’s US$1.9 trillion stimulus package passed earlier in March.

In a note, Alex Tuckett of CRU Group said the plan has implications for commodities like copper, which could see a demand rise of 110,000 to 170,000 tonnes per year depending on how spending pans out.

“Depending on how much of this package is passed by Congress, and the details of particular spending lines, this package could boost steel demand in the US by between 5 and 9Mt per year, copper demand by between 110kt and 170kt per year, and aluminium demand by 130kt and 220tk per year over a five-year period” — Alex Tuckett, CRU Group

With that in mind, we asked our Twitter followers this week how much they think the Biden infrastructure plan will affect the price of copper. The majority of respondents said they expect it to have a moderate impact, while about 35 percent said they think it will have a significant impact and 19 percent said they don’t expect it to do much.

We’ll be asking another question on Twitter next week, so make sure to follow us @INN_Resource or follow me @Charlotte_McL to share your thoughts.

Finally, INN’s Bryan Mc Govern took a look this week at the psychedelics sector, where psychedelic retreats are beginning to attract interest.

Similar to traditional wellness retreats, the goal of psychedelic retreats is generally to give participants an experience of renewal or even spiritual awakening — the difference of course is that psychedelic retreats use psychedelic drugs and professional guidance to achieve those experiences.

So how can investors get exposure to this new and interesting part of the market? At this point, none of the companies focused on psychedelic retreats have gone public, but as the industry continues to grow, insiders believe it may only be a matter of time before it happens.

“Why not? I think absolutely, it will happen. It’s just a matter of who and when and where and why” — Jonathan de Potter, Behold Retreats

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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.