Gold The One Investment You Can Always Count On

When reading into and trying to understand the markets it is important to know a few things well. One cannot be an expert at everything and if you try, you will end up being good at nothing. One must find a place in the markets to park their butt, and learn.

Since I have entered the markets in late 2005, one of my first trends I identified was gold. I hopped on the gold bandwagon at the last time gold dipped below $500 and took off. That is almost 5 years ago and 150% return later, Gold is still going strong. Since that time I learned everything I could about gold, its fundamentals, its trading patterns anything and everything that has to do with gold. I learned the arguments for gold and arguments against gold. Over the last 4.5 years, basically memorizing everything to do with gold.

Now some may call me a gold bug because I believe gold is still far from peaking. But how can I be a gold bug when I have only been in the industry for 5 years? I am certainly not a gold bug and will jump off the train when the time is right, but that time is not now.

More often than not, (and after a bit of nail biting) my calls in gold are usually right. Last summer I called a breakout in gold the day Gartman claimed he sold all his gold and gold promptly went on a 4 month run from a breakout at $1000 to $1250...

This summer I called for a correction in gold, and though it wasn't as dramatic as I though it would be and it had to fail a breakout before it came down below $1200 and settle halfway in between my correction targets of $1140 - $1170 before promptly moving back to $1200. I heard so many people over the last week to get out of gold, on BNN, on Stockhouse, I even heard someone say short below $1170????

Really you can' fault these people because they don't follow gold like I do, but it proves you can't know everything and you need to defer to the experts instead of trying to know it all like most of those 'cases' on BNN. In the end they all look like fools... 3 analysts on BNN called for a major sell-off in gold. To the journalists credit, most of them gave the analysts a way out, asking about seasonal trades and timing, but all said the same thing... Sell gold. Don't buy it here.

I could not find a gold bull anywhere last week... except me. The fundamentals driving gold just won't relent and will stay in place for the time being.

I don't know much about the markets, and can often put my foot in my mouth, but one thing I know for sure is BUY GOLD!

The last 2 weeks were an excellent opportunity to buy like I said and now that we have confirmation that gold has bottomed and another breakout to all time highs is imminent, The time to buy Gold and Gold stocks is NOW!!! There is one area of resistance that needs to be broken before confirmation of this continuation pattern. This week or next, gold must beak through this last area of resistance between $1200 and $1210 to confirm the bottom that developed in gold over the last month.

I hope you took the last 2 weeks to load up on your favorite gold stocks because this fall is going to be another major run. If you haven't yet, there are still some good value for some great gold stocks.

EAS, VEN, CSI,SAS, SGR all have great growth profiles for a midcap names.

If you want more leverage and can assume more risk... CXT, PEM, DEC, and FAU are great smallcap names.

Happy Trading

All That Glitters is Gold

Gold stocks look to be on the move today signalling that the selloff in gold may be close to an end. Ventana Gold released excellent results with more extremely high grade results which has pushed the stock up over 13% to over $8 at its height today. If gold doesn't make it back over $1170 it will probably try and test the lows and support at the 200MA, but the way the price is acting and the way the cream of the crop gold stocks are acting today, it is starting to look like a bottom.

With stocks like Ventana reacting so well to good news it also bodes that the mood is much better for buying gold stocks than it has been at any time in the last 3 months. East Asia Minerals, another impressive deposit also took a hard turn towards the 50 and 200MA's today breaking out of its consolidation pattern. It certainly is not a declared bull again in gold but some of theses stocks look like they are not going to get any cheaper.

Today's trading looks like there is more than average buying interest for gold stocks. At least the premiere ones today. The smart investors will be buying gold stocks over the next month for a very strong seasonal run this fall.

All I know is that the 2 factors that are pulling the markets between a bull and a bear at the moment both will eventually drive POG much higher.



All that glitters is gold. :)

Happy Trading

Gold hits first Correction target

Yesterday morning or afternoon depending on where you are in the world, gold hit my first correction target of $1170. Gold actually traded $1175 but it is close enough to say that it hit it and it moved off that price with authority. This represents an excellent entry point for gold, but is not a fail safe entry point as it is still halfway between the 50M and the 200M meaning that technically there is still a good chance that POG can correct to the 200MA at $1141. Any correction to $1141 should be quick and brief if it happens so be prepared to buy at that price point as well. We are technically entering into a strong buying season for where prices are seasonally strong and within super bull markets, cyclical bulls can be quite predictable and gold is seasonally strong from now until September in the very least with more strength coming in the late fall and early winter that usually extends the summer rally.

I am expecting gold to breakout above $1260 this August / September and now is the time to pick up some of these stocks on the cheap. I would enter half my position now at this point and buy the other half at $1140 if it gets there and if it doesn't would buy the other half on a breakout above the 50MA.

Some great stocks to buy... VEN.TO, EAS.V, CSI.TO, SAS.TO, KAM.V, DEC.V, FAU.V, CXT.V.

Will Gold Move To a Bear?

Some people are calling for gold to correct with the rest of the markets in this bear as it did in 08/09. Not to sure if I agree...

Argument is inflation/deflation for the bear side with global ST deflation a possibility with EU and China bears. Problem is that is not the only component that is driving gold. The decoupling of POG from the USD this spring has major significance that some people are just plain missing. Gold will selloff on the all asset liquidation days for sure, but it will have major strength as an emerging alternative currency.

Any price movement between the 50 and 200 MA's is a major buying opportunity. With impending implosion of the Euro and sell-off of major currencies, an obvious choice has been gold. Confidence will not return to the currency markets for awhile so this trend to buy gold as a currency hedge is increasing, not decreasing.

Added to this fact is that the long term result of printing all this money today to bailout the financial crisis and now this impending debt crisis, is that there will be major inflation over the long term. Prices don't go up because of demand, but because of a falling value of a currency. Simple. Too much money added too quick will take down the currency because now value has been created. To paint a picture, it would be like preferred dividend holders getting a ridiculous common stock dividend that diluted the company enormously while the rest of the common stock shareholders got nothing. All they are doing in the long run is dilluting the currencies.

The party is long from over in the current gold bull.