Lombardi: Stock Market Commentary & Forecasts, Financial & Economic Analysis Since 1986

Posts Tagged ‘investing in gold’

Spot Gold Is Going Down, But Attractive
Stock Market Opportunities Are Going up

By for Profit Confidential

precious metalsThe stock market and a number of commodities are in correction and this is no surprise at all. I want to repeat my view that all kinds of solid, growing gold mining companies are becoming very attractively priced right now and, as a sector, it’s worth putting gold stocks on your radar screen.

It’s a bit too early to jump right in with the spot price of gold likely to experience more downside. From a stock market perspective, most gold stocks began pulling back hard in mid-March, affecting even the best stocks within the sector. We’ve got to see the spot price of gold bottom out from its current downtrend and then I think we’ll have another really good entry point for considering new positions.

Investing in gold has always been a risky business, but it’s a worthwhile endeavor if you’re a stock market and commodities speculator. The key, like always, is to get the cycle right—timing in the investment business is everything. Even though the long-term trend might still be intact, the spot price of gold could easily go down to $1,200 or $1,100 an ounce. Why not? Gold has been in a bull market since 2002. The current price action in spot gold is very similar to the correction that occurred 2008/2009 and I wouldn’t be surprised at all if it repeated this trend: correction, recovery, consolidation, and then re-acceleration. It does take time.

Right now, there are large, medium and small producers of gold trading for reasonable prices on the stock market. A lot of these companies have little to no debt and are sitting on large … Read More

Best Play for 2012: The Gold Mining Stocks

By for Profit Confidential

Over the past three trading days, gold bullion has lost roughly $100.00 an ounce. This correction is good medicine! The speculators who got into gold late are being taught a lesson. The weak money is leaving gold. This is exactly the type of healthy correction in the 10-year bull market in gold that I’ve been waiting for!

10-year Strategy of Buying Gold Stocks When Gold Bullion Moves Lower in Price Still Working

By for Profit Confidential

There is one strategy investors have (or at least this investor has) been following for 10 years to make money in this treacherous market. The strategy is quite elementary. Every time the price of gold bullion moves down three percent, I like to go in and buy more gold-related investments. This strategy has worked for 10 years and I still see the opportunity continuing in buying gold stocks when the yellow metal has sharp, one-day corrections.

Investing in Gold with a Spot Price Near its Record—Time to Buy High & Sell Higher

By for Profit Confidential

In turns out that gold stocks are resuming their upward price trend in an environment where the spot price is ticking close to its all-time record. Gold stocks are the place to be if you’re a stock market speculator and if you believe that investing in gold will be fruitful in a slow growth environment. Nobody can with any real expertise predict where the spot price of gold will trade in the future, but all the fundamentals continue to line up. Investing in gold is something that I really believe in.

Precious Metals Mergers About to Take Off

By for Profit Confidential

Gold bugs are feeling the pain, as precious metals continue with their slower-economic-growth correction. As well, the prospect of action on the Europe debt crisis is tempering the marketplace’s appetite for gold futures. My view is that gold and silver continue to represent some of the most attractive assets going forward over the next several years. We’re in a market where new trends take a long time to develop and we’ll likely see the spot price of gold trade around $1,600 an ounce for quite a while yet.

Answered: Can I Still Make
Money Buying Gold Now?

By for Profit Confidential

Most investors likely fall into one of these three categories: They likely haven’t bought gold investments yet and they are thinking it may be too late to get in. Or they have bought gold investments and they are wondering if they should by more at these prices. Or, like me, they take as many opportunities as possible to buy more gold investments each time the price of gold bullion pulls back.

Gold: Getting Ready for
the Coming Correction

By for Profit Confidential

I’ve learned many things about investing over a career that has spanned 30 years. One of the biggest lessons is that not a single investment goes either straight up or straight down. When an investment is rising in price (bull market), there are usually dips and corrections on the way up. Just look at the long-term secular bull market in stocks that started in the early 1980s and ended in 2007—there were many times stocks “took it on the chin” during that 25-year bull market run.

The Best Bet in Town—Resources—Getting Ready for the Big Squeeze

By for Profit Confidential

The key in this bear market with stocks is to stick with resource stocks if you’re a speculator. I like large, blue-chip companies that pay high dividends for long-term investors. For risk-capital equity traders, the best action remains with gold stocks, and some of the best value now is in oil.

The Only Asset Worth Betting on—You
Guessed It! This Story’s Just Getting Started

By for Profit Confidential

If this is the decade of the commodity, then the single most attractive area for equity speculators remains the gold-mining business. The entire industry is swimming in cash, while spot prices and physical demand for precious metals remain strong. Gold, silver and copper have been holding up exceedingly well, as the rest of the stock market corrects. And it isn’t just the store of value argument or the so-called haven status of gold; the fact of the matter is that the global supply of the commodity is relatively unchanged, while demand (particularly from India and China) is going up.

New Higher Margin Requirement
for Gold an Investor Opportunity

By for Profit Confidential

After months of patient waiting, the gold stocks came to life yesterday. Right across the board, whether it was junior or senior gold producers, the stock prices of gold companies were up sharply Wednesday. Hopefully, my readers have been following my guidance and seeking refuge in the gold-mining companies. Since the spring of this year, gold bullion prices have been rising sharply, while gold stocks stood pat. I have been writing that the leaders of the gold bull market would shift from the actual bullion to the gold stocks, and that’s what started happening Wednesday.

Gold’s Burning up on the Chart;
My Gold Advice

By for Profit Confidential

The precious yellow metal is sizzling on the price charts, as traders shift capital from the higher-risk equities to the safe-haven sanctuary of gold. The U.S. is battling crippling debt levels and deficits. Some cities across the nation are shutting down to save money. The once powerful U.S.economic engine continues to show breaks and is stalling at this most critical time for the country.

The Gold-to-Silver Ratio: Why It’s Important, What It’s Telling Us Today

By for Profit Confidential

What the gold-to-silver ratio is, why it's important and what it's telling us today.~ reporting from Venice, Italy

I often write about gold bullion in my commentaries, but not much about silver. And my readers are writing asking me what I think about silver. As usual, I’m happy to present my ideas and forecasts.

Right up front, I want to say I’m more biased towards gold than silver as an investment. I’ve been pushing gold since 2002. At that time, I started getting concerned about spiraling U.S. debt and the increase in the money supply.

My thought has always been: if the validity of the U.S. dollar ever comes into play, gold will be the currency of choice. Not silver. I can see the government eventually forced into a situation where U.S. dollars again will be partially backed by gold bullion. I can’t see U.S. dollars backed by silver.

On the other hand, silver is used in many different industries, whereas gold is still primarily used in jewelry and as an investment-related commodity. And, as the economy in China continues to boom, as we believe it will, demand for silver for industrial use will continue to rise, pushing up silver prices.

Gold prices are up about 13% this year compared to a 29% increase in the price of silver so far in 2011. Silver is actually outpacing gold in terms of price appreciation this year.

The gold-to-silver ratio works like this: we take the current price of gold and divide it by the current price of silver. Historically, over two centuries, the gold-to-silver ratio has been 37-to-1. Today, it sits at 40-to-1.

What does this tell me? It tells me that silver … Read More

$2,000 for an Ounce of Gold Seems
Like the Only Bet Worth Making

By for Profit Confidential

It’s pretty clear that the economy will be in a slow growth state for quite some time and the most important economic statistic to follow will be consumer spending. We know that the economy is going to be lackluster for the next several years, because government spending will continue to be reduced, putting pressure on any income growth. It’s the age of austerity and it’s going to last for quite a while.

An Early Obituary for the Euro

By for Profit Confidential

Does America want members of the 17 eurozone countries to go bankrupt one by one? If only a few went under, the American currency would win the currency wars and reaffirm itself as the reserve currency of the world. If you were someone living outside the U.S., wouldn’t this sound like a “secret” strategy that could work? After all, are not all the major credit reporting agencies (that grant credit ratings to European countries) subsidiaries of major American corporations?

Gold: The Only Sector with
Improving Fundamentals

By for Profit Confidential

The stock market is facing some strong headwinds over the short term and all the wrangling is a real shame considering that we’re still getting great earnings results from large-caps. It’s no wonder the spot price of gold keeps ticking higher; there’s nothing else for investors to rally around.

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