Not a subscriber? Click here to learn
more.
|
| Home | About Us | Resources | Archive | Free Reports | Market Window |
Gold Finally Hit BottomBy
Thursday, January 30, 2014
It's official... Gold has bottomed. And gold stocks have, too.
Take a look... Gold and gold stocks have taken off this year, while the stock market has done nothing...
 As I'll explain today, I think this move is legitimate... Gold bottomed in December.
The bottom made total sense, for two major reasons:
Specifically, "precious-metals sentiment dropped close to zero" in December, my friend Jason Goepfert of SentimenTrader wrote. (His scale is 0 to 100.) As far as investors were concerned, gold was as HATED as it gets. When something can't get any more hated, it eventually gets less hated... and that's when you want to own it! That is where you can make real money.
Also, gold stocks were as CHEAP as they get... "Gold stocks are 48% undervalued" relative to the price of gold as of December 31, John Doody of the Gold Stock Analyst newsletter wrote. (That's the biggest discount in history for gold stocks.)
I spoke with John on the phone a few weeks ago about this. He told me back then that "everyone who wanted to sell has now sold. Now is the time."
He was right. In my True Wealth newsletter, we stepped up. We bought gold stocks a few weeks ago.
And as you can see in the chart above, buying gold stocks a few weeks ago was the right call... We now have an UPTREND in gold stocks. (The "safe" play we made in my newsletter has actually outperformed gold stocks.) Gold and gold stocks are now beating the stock market.
Gold has bottomed. Gold stocks have bottomed.
And now we have our True Wealth "trifecta"... Gold stocks are CHEAP, HATED, and IN AN UPTREND.
We have everything we want to see in an investment right now. This is when you want to buy.
As John Doody said, "now is the time." I think he's right... The setup doesn't get any better than this.
Don't let this moment pass you by... Buy gold and gold stocks now...
For the safest trade, use a stop loss at recent lows... Otherwise, let 'er rip!
Good investing,
Steve
Further Reading:
Two weeks ago, Steve tapped 47-year precious-metals veteran Michael Checkan for his thoughts on gold. "Michael has personally lived and worked through ALL the ups and downs in the gold market," Steve writes. So what is he thinking today? Click here to find out.
No matter what you think will happen to stocks or precious metals this year, gold is an important part of any portfolio. "I look at gold and silver the way a homeowner looks at his insurance policy," Dr. David Eifrig writes. "A homeowner buys insurance against disaster and hopes disaster never comes. Similarly, I hope I never make money on my gold and silver..." Get the full story here.
Market NotesIT'S A WILD RIDE FOR HOLDERS OF THIS ASSET! Before you read today's commentary, look at the chart below. You'll see the price action of an asset that swings wildly in value.
Is it the price action of a speculative start-up company? Is it the price action of a volatile commodity like silver? No... it's the price action of the U.S. dollar.
Most folks believe currency fluctuations don't affect them... or that the whole subject is just too boring to pay attention to. After all, how much can the value of your bank account really swing up and down? The answer is A LOT.
Today's chart is a 10-year chart of the U.S. dollar index. It measures the dollar's value against a basket of foreign currencies, like the Japanese yen and the euro. It's the generally agreed-upon measure of the dollar's global trade value. It displays the value of our bank accounts.
You can see how the U.S. dollar is bouncing up and down with tremendous volatility. Double-digit percentage changes in value (12%... 15%... 20%) are taking place in the span of months... not years. Think holding U.S. dollars in a bank account is a boring, conservative idea? Think again.
 |
In The Daily Crux
Recent Articles
|
