The spot price of gold is now well above $1,800 an ounce and gold stocks are reaping the benefits. Right now, the stock market is experiencing a crisis of confidence—not in the ability of corporations to generate earnings, but in the macro sense of country economies, debt and deficits. The global debt crisis is just that—a crisis—and it’s been building up for years.
Archive for the ‘gold prices’ Category
What a few months it has been for gold. With war worries in Libya to debt concerns in Europe and the United States, along with rising demand out of China and India, it appears to be the perfect storm for driving gold prices higher. In fact, the break at $1,500 was much sooner than I had expected and, based on the chart, prices could go even higher, albeit the buying may be somewhat ahead of itself and hence vulnerable to some profit-taking.
The June gold broke to a record high of $1,535.10 on April 28 and is looking to go higher. The chart showed a bullish inverse head and shoulders formation in March. Prior to this, there was a bullish V formation in January and early February. The June gold made a strong breakout at the $1,440 resistance that was in place since November 2010 in early April.
Three major trends in the financial markets, all from which investors can make money, continue their development this morning…
Trend #1: Rising long-term interest rates. The 10-year U.S. Treasury hit a yield of 3.6% Friday morning. My forecast calls for the bellwether 10-year Treasury to easily sail past 4.0% this year.
If you are a stock market investor or a gold investor, or both, today’s PROFIT CONFIDENTIAL is a must-read. Why? Because, by the time you are finished reading this issue, you could very well be convinced long-term that the stock market is going down and gold is going up. And you can make a lot of money from these moves.
I think that investors should be keeping a close eye on the spot price of gold and be ready to consider new positions in gold stocks if there’s any meaningful correction in the commodity. Spot prices seem to be taking a bit of a rest here, but they’re still holding up relatively well. In fact, we may not even get a correction in gold prices due to the seemingly universal agreement on a weakening U.S. dollar.
Investment money has a tendency to run to the place where it has the potential for the highest return.
In the late 1990s, we saw investment money run into tech stocks as the NASDAQ hit 5,000 (only at 2,209 today, 10 years later). In the mid-2000s, we saw money run to real estate as property prices boomed on interest rates that were low and easy-lending policies (residential property prices have fallen about 30% since then)…. Read More
Over the last two years, it took five attempts for gold’s price to finally break above the psychological resistance at $1,000 per ounce. Though gold has been in a secular bull market in all currencies, much of the “credit” for the decisive breakout to the all-time high above $1,000 per ounce goes to the sliding U.S. dollar. In contrast, gold has yet to make any comparable breakouts to new all-time highs in the other two big currencies, the Euro and the Yen.
The news is pretty grim and there is a lot of liquidation going on in the equity market. I can imagine that the only people making any money in this market are those who are any good at trading S&P 500 Index futures. And the global coordination of the current financial market turmoil is a real sign that investors are expecting a serious, worldwide economic slowdown.
Investment risk remains very high and we’re in one of the climates where anything can happen to a financial instrument…. Read More
It’s just after World War II and the strength of the U.S. military
reigns supreme around the world. With the end of the war, a
construction and manufacturing boom starts in the United States
that will last at least half a century.