Are You Wondering Whats In Store For Gold?

April 9, 2010 | By | Reply More

Gold, silver, platinum, palladium are all having a good week as risk aversion, the fragile Euro and an indecisive dollar leave investors wondering what the next few weeks have in store.

  • Will inflation stay subdued or are there signs that “factory gate” prices are increasing and likely be quickly passed on to consumers?
  • When are the residential and commercial property problems going to show real signs of improvement keeping in mind the high levels of unemployment and stagnant new long-term job growth?
  • Despite the sound bites is there a likelihood that interest rates will have to rise before the end of the year?
  • Will governments bite the bullet and stop printing and throwing money at undeserving causes?
  • Will rampant socialism continue its destructive course on the US, Britain and other developed countries or will the natural supply and demand equation restore capitalism and equilibrium to the ordinary citizens of the world?
  • Most importantly when will governments tell their citizens the truth, own up to their horrific mistakes and take urgent steps to rectify the lies we have been fed for years?

One way or the other it is hard to see the US and Europe prospering in the future until these and many other problems are addressed. Sooner or later the pack of cards we call our standards of living are likely to collapse and the longer the remedies are put of and the lies and distortions continue the greater the hardships that Joe Public and his offspring are going to endure.

In the meantime going short on stocks will, sooner rather than later, make a lot of money for players that get their timing right and have nerves of steel.

For us mere mortals we see gold, silver and to an extent PGMs (Platinum Group Metals) as our eventual salvation.

The recent reverse head and shoulders pattern shown by gold indicates a possible rise to $1240 an ounce, we just mention this in passing!

We should mention an exception to our comments on shorting stocks and that is the energy sector. We think that the nuclear industry is the future for power and that oil has only one way to go in the next few years.

In particular, and although outside our brief of precious metals, we have had a close look at British Petroleum (BP:NYSE).

The fundamentals are good with excellent management in place and for the technically minded the chart set up augurs well with the stock trading above its MA and after a double bottom in February has enjoyed a nice upward trend.

Looks an acceptable investment in these otherwise troubled times. We will be looking next week for an opportunity to buy, probably leap call options but have no holdings at this time.

In future articles we intend to offer snippets like this from time to time, without prejudice but with high hopes.

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