Categories: Precious Metals
Topics: Gold Stocks

Why Gold Bars Are Selling Out At Costco

The S&P and DOW are dancing around record highs.

A lackluster Christmas season has proven two contradictory points: consumers are both playing it safe and yet are still spending more cash (or in many cases, credit) than many pundits expected. It’s both less and more.

But in this confusing macro landscape, one enduring fact has emerged: retail investors are feeling the effects of this uncertainty, and they want gold.

Demand is now so strong that it continues to keep gold hovering near its all-time high — and I suspect this is only the beginning as trend lines point to sustained highs ahead.

Not only is it in demand in principle, but it’s also flying off the shelves.

Warehouse megaretailer Costco has been selling one-ounce bars, and its members are buying up as much as it has to sell.

As Fortune magazine put it: 

"...the members-only warehouse chain has seen its 1-ounce gold bars sell out faster than discounted 170-ounce jugs of laundry detergent."

Retail investors are demanding retail gold, and supply can’t keep up. It’s the fundamental circumstances that we’ve been waiting for. And the overall macro financial environment continues to push this further.

Geopolitical instability (Ukraine woes, Israel crisis, China showdown), the Fed flapping from dove to hawk (as the dollar wavers), and political uncertainty (the election nightmare is just beginning) are all taking a toll on investor sentiment.

Gold remains the fallback in times like these, and so it’s no surprise that we’re seeing the prices we are. If anything, it’s been slow in coming. 

But now that it’s here, all signs point to an increase in gold price, an increase in gold volume, and an increase in gold holdings. And even more promising is the sustained strength of the overall pattern.

As you can see in the chart below, its 50-day moving average recently crossed its 200-day moving average. This indicator is known as a “golden cross,” and it usually signals movement into an overall bullish trend.

So it’s no wonder that confused and worried retail investors are filling their Costco carts with gold bars.

But while Costco’s entry into physical gold is an interesting story, I personally think you can do better when looking for exposure to these high gold prices.

I’m in the process of writing a special ETF report for the start of 2024, and my list includes a number of gold ETFs (keep an eye out for this in the weeks ahead). 

And then, for those who want to take their gold investments to the next level right away, I recommend watching Nick Hodge’s recent visit to what he’s calling "America’s Next Biggest Gold Mine."

In this video tour, Nick details why he’s going straight to the source for more gold — and why this US junior has such an edge on major-level production.

We expect to see gold continue to break new highs as we kick off 2024.

Make it your own,

John Carl
Editor, Daily Profit Cycle