Thank goodness for the spot price of gold. This is the one sector of the stock market (and global economy) that’s flourishing within all the turmoil. Not only are the fundamentals for gold very strong, but they are actually improving, as price inflation is going up in the world’s biggest economies.
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.
It seems that the only growth stocks out there in this market are related to natural resources (i.e. gold, silver, oil, corn). We might only be halfway through the current commodity price cycle and, even if you don’t much believe in it, you can’t argue with the price performance of a lot of commodity-related stocks. It’s the hottest area of the equity market and it’s going to stay that way for a while.
I feel so strongly about investing in gold and silver that I keep writing about the precious metal sector, even though it goes against my usual philosophy of trying to buy low and sell high.
Gold is sizzling hot! The chart is pointing to potentially more gains. The June Gold contract hit a record high of $1,462.30 on April 6, in what appears to be a breakout on the chart at $1,430, followed by key resistance at $1,440
The economic news out there still isn’t great, but the stock market doesn’t seem to care. Equity investors seem only worried about first-quarter earnings and the outlook for the numbers remains very bright.
Investing in gold is a subject that’s been well endorsed in this publication and the spot market for gold futures has been due for a correction. But, we aren’t getting much of a correction in gold (right now) because global investors feel that investment risk is high enough to justify gold future prices at almost record highs.
If pressed to make one buy recommendation (other than farm land and/or distressed real estate), I would still pick gold. Make no mistake; all the price of gold needs to do is stay about the same and 99% of gold miners will be making money hand over fist.
If pressed to make one buy recommendation (other than farm land and/or distressed real estate), I would still pick gold.
I continue to see a lot of good news hitting the wires and I hope this momentum lasts.