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« Agnico-Eagle Still Buzzing at $80.00! | Main | Gold Update: 11 March 2008 »
Thursday
Mar132008

$1000 Gold: Achieved!

Well,well, well, We will say that again because it is so nice to do so, $1000 to buy one once of gold - Yes!

Gold Chart 13 March 2008


Although it was touch and go gold finally touched this magical number albeit for a short time before backing off to $990/oz to tease us a little more.

USD Chart 13 March 08

In our recent update on gold we referred to the US Dollar getting a shot in arm from the Federal Reserve and questioned how long it would last, not long appears to be answer as the once mighty dollar resumed its relentless march to the south pole. All eyes are now focused on the 18th as we wait to hear what the rate cut will be, for what it is worth we think another half a point will be delivered from the Feds. This will give the broader market yet another fix, put another nail in the dollars coffin and cause gold to act in its usual inverse manner to the dollar and go higher. How high you ask? Trying to analyse at this micro level is a sure way to look silly but for what it is worth we think it will go to $1010/oz - $1020/oz. A lot depends on just how much media coverage this new high attracts. The coverage has certainly been building and this milestone should generate a lot of headlines for gold. The media coverage will attract new investors with new cash to inject into this relatively small sector of the market. On the other side of the coin we will see some profit taking, although we suspect not a great deal. Some of our readers have adopted a policy of keeping hold of their shares and buying 'Put' options on both gold and silver as an insurance policy should there be a correction. There isn't a strategy that will fit everyone of us just as there isn't a suit that will fit everyone of us. We are all unique individuals who require a unique investment strategy, albeit within an overall framework that has similarities. Years ago the conventional wisdom was to put about 5% of ones investment cash into gold and associated precious metals mining stocks. Our approach has been far more aggressive as we have been 100% invested in this sector of the market, as of today we have 13.25% in cash, on the sidelines which we regard as 'opportunity capital' and when that opportunity presents itself we will go for it.

Do remember though that when something is at the bottom you tend to think that it can never go up and when something is at the top it can never go down. Several years ago in Britain the pound fell out of the European monetary system and the base rate leapt up to 15% and most of us thought that we would never see cheap mortgages again. Over time and with some creativity from the mortgage lenders we were able to borrow at rates of around 4%, again thinking that those high rates had been banished forever. What short memories we have. As with gold we are at a new top and the euphoria is spreading like wild fire and we are enjoying it as much as the next gold bug, if not more. The next week or two will be fascinating to observe as we look for the next opportunity, whether it be a buy, a sell, a Put or a Call option. This has to be the most exciting place to be in terms of investment that is fast moving and sensitive to a myriad of variables.

If you do not have any investments in this sector and would like to follow our adventures in gold and associated precious metals mining opportunities then please click here to receive our free investors newsletter.

Smile you are winning!

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Reader Comments (7)

"Do remember though that when something is at the bottom you tend to think that it can never go up and when something is at the top it can never go down."

Careless words, even though they sound so full of wisdom. Just remember, some things DO go down and never come back up...like Titanics...and who'd of ever thunk it?? And there are others as well. Things with true value at some point in a fall become undervalued and rise back up, but things with NO real value do at times sink to their true value.

The FRN...the dollar...is a piece of ink-covered paper, and even more now a few electrons traveling thru the ether passing for money, among now hundreds and hundreds of trillions of like pieces, backed by absolutely nothing but a lying and deceit Federal Reserve Bank who have shown that they have nothing but contempt for the working class of this country and will rip it off mercilessly and endlessly to bail out themselves and their banking buddies. So when making broad statements that the naive may latch on to, make sure you are VERY precise in your seeming recommendations.

March 14, 2008 | Unregistered Commenterjt

At the end of your newsletter you recommend subscribing to your newsletter. This is confusing to me (as it is regarding your uranium newsletter). Do you publish two different free gold newsletters, or just one, the one I am already receiving, please? If you publish two different ones, I would be happy to subscribe to the second free newsletter.

March 14, 2008 | Unregistered CommenterNeil Bishop

You have been saying not to buy gold at these high prices because you thought there would be a correction that would present a buying opportunity? Do you still feel that way and if so, how low do you think the correction will get to?

March 15, 2008 | Unregistered CommenterDan Hubbell

what is the target price of gold in june 2008 in ounce

March 16, 2008 | Unregistered Commentersuresh

Neil,

We run three site which all have one and one only free newsletter and they are:

www.gold-prices.biz
www.silver-prices.net
www.uranium-stocks.net

hope this clarifies the situation for you.

March 16, 2008 | Unregistered CommenterGold Prices

Dan, Yes we are expecting a correction sometime after the next rate cut, but we don't know by how much just yet, but we will put our thoughts and actions on paper as usual.

March 16, 2008 | Unregistered CommenterGold Prices

Suresh, We are working on it as we expect it to be lower than it is now, will post when we have a better handle on it.

March 16, 2008 | Unregistered CommenterGold Prices

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