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As I write Gold down $3.00 to $366 oz (April Contract). Things are getting very interesting, Japan’s exports drop a new record level. The Wall Street Journal has a quick article about investors wanting Gold in Hand (taking Delivery). As I wrote a few days ago the fastest way to create a short squeeze is to take delivery. Especially on Comex in both Gold and Silver. Is the noose getting tighter? Gold is in a consolidation pattern getting ready to take off? Some say yes other’s in fact a majority are saying no it’s time for a correction. As I mentioned yesterday when most of the crowd is saying one thing the market usually does exactly the opposite. We will see as I am keeping a very careful eye on the Gold market and will let you know via this blog and Twitter when I am getting out of the Long DGP trade. Finally! Cramer has finally decided to give Gold some coverage after a $200 rally, quick excerp below. Let the fun begin! Good Investing! – jschulmansr
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In spite of gold’s dip from $1,000 to $950, Cramer thinks the uncertainty in the U.S. and in Europe will be good news for the traditional hedge. The question is how to invest in gold. One way is to buy bullion or gold coins, but Cramer prefers stocks. SPDR Gold Shares is a good way to track the price of gold. Cramer would buy a fourth of a position at $90, another at $88, then $85 and $82. He reminded viewers that gold stocks have unique metrics; production growth, sensitivity of earnings to changes in gold prices and price-to-net-asset value. Two gold stocks worth looking at are Agnico Eagle Mines and Eldorado. Agnico has an impressive 344% growth rate, with Yamana at 56% and Eldorado at 27%. Eldorado keeps production costs very low at $286 per ounce: Goldcorp’s expenses are $397, Yamana $411 and Agnico is $483. Even though Agnico’s production costs are at the top, Cramer says they are going down. However, EGO is less sensitive than gold prices than AEM. According to the price-to-net-asset value, AEM is the most expensive, with EGO and Newmont behind. In short, Agnico has an impressive growth rate, but Eldorado might be a better value.
Source: WSJ Online
Some investors are so worried about the prospect of economic collapse that they are buying gold and having it delivered to them, rather than holding the precious metal in the form of futures contracts or other securities.
The global recession and worries about the stability of the financial system have sent the price of gold to $1,000 an ounce. But more surprising is that buyers are taking the unusual and expensive step of taking possession of it.
“We’re having some of our strongest months ever,” said Scott Thomas, president and chief executive of American Precious Metals Exchange, a precious-metals dealer …
One’s bottoming, one’s topping and one’s consolidating. Can you guess which is which?
Give yourself a cigar if you said oil, U.S. Dollar and gold.
The 50-Day Moving Average is just pennies away ($42.50). A close above it could bring in some technical buying. Some early signs of peak supply is showing up and with more people believing OPEC is living up to its quota’s, the mid $30’s look more and more like the bottom.
We’re at one of the more critical technical points in quite some time. We either have a triple top just above 88 or a major breakout above 90. Because I’m so bearish long-term, I’m currently positioned on the short side. A break above 90 will cause me to rethink my position. Stay tuned.
The magical $1,000 level has for now proven to be just a news story. I, myself, received several requests for interviews and comments last Friday on $1,000 gold from media people who don’t normally cover gold. This suggested to me that we got a little ahead of ourselves. The $925-$950 area should be the limit to this consolidation. Don’t be surprised if we shoot above $1,000 in the coming days.
Late Flash: They’re trying to manipulate the Gold market again or else the traders are trying the push. I have been stopped out of DGP @ $958. Nice trade. I will now be looking at my next entry point to jump back in again. Gold currently $943.60 (April Contract). I think the lowest April will correct to will be $925 oz (April Contract) and then we are back to challenging $1000 and the all time highs again. Remember 3’s a charm! Good Investing! – jschulmansr
Catch the New Bull! – Buy Gold Online – Get 1 gram free just for opening account– just click here and then again on the Gold Bar!, no minimums – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com
Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. – jschulmansr