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Right Now Is the Best Time to Buy Gold Since 2008By
Tuesday, July 12, 2011
"Did I miss it already in gold?... Is it too late to buy?"
I hear these questions from readers a lot.
They're fair questions... After all, gold has soared from $300 an ounce to $1,500 an ounce in the last 10 years.
The answer is simple. You didn't miss it... It's not too late to buy. In fact...
Right now – right this moment – is an incredibly good time to buy gold. It's the best time to buy since late 2008.
Investors are more apathetic about gold than they've been in years (based on excellent research by my friend Jason Goepfert of SentimenTrader).
Jason's proprietary measure of investor sentiment about gold is now at its lowest levels since November 2008. (That's good. You want to buy when investor sentiment is bad – that's when your upside potential is the biggest.)
The last time gold sentiment was this low, gold soared nearly $500 an ounce in one year. It's true... Gold bottomed in November 2008 near $700 an ounce. One year later, it nearly hit $1,200 an ounce.
I was surprised to hear Jason report that investors are so apathetic about gold today... particularly since gold hasn't fallen all that much in the last two months.
Jason explains why he thinks this happened: "Sometimes when a market has been strong for a long time, people are so afraid that every little hiccup is the bursting of a bubble that they become very pessimistic very quickly... The metal has held up very well, yet many of the measures we track are at or near two-year lows in optimism."
I think this is a bullish sign for gold. The price of gold has held up very well as investors have given up a bit on it. So... gold is in a clear uptrend... yet investors are apathetic. This is what I like to see!
You see... bull markets don't peak when investors are apathetic. Bull markets peak when investors are crazy with excitement. So this bull market in gold has farther to go.
I know I've written a lot about investing in gold and gold stocks recently.
About gold... Last week, I explained how our True Wealth Systems gold signal is in "double bull" mode right now. When that's happened in the past, your wealth compounded at an annualized rate of 50%-plus in a double-long gold index. Own gold!
About gold stocks... A month ago, I called the bottom – to the day – in gold stocks... On June 15, I wrote, "History Says Gold Stocks Could Double In Eight Months." Gold stocks are super cheap, as I explained in yesterday's DailyWealth. Own gold stocks!
About gold coins... I wrote an essay a month ago called "This Soars in a Gold Bull Market, but You Haven't Missed It Yet." While gold has soared since 2008 (as I explained above), these particular coins are actually flat in price. It's stunning... a great opportunity with limited downside risk and significant upside potential. Buy gold coins!
Yes, the price of gold has risen from $300 to $1,500 in the last 10 years... But no, you haven't missed it yet. Actually, right now is the best time to buy gold since 2008.
You can own gold, gold stocks, and gold coins. Just make sure you have the maximum position you're comfortable with right now. Double-long gold funds are fine with me at this point.
It's the best time to buy gold since late 2008... Take advantage of it!
Good investing,
Steve
Further Reading:
Last September, Steve showed DailyWealth bullish results from Jason Goepfert's research: "We've seen this indicator set up like this 48 times since 1987... And 47 times, stocks were higher three months later." Sure enough, the S&P 500 climbed 11%. Find out what metric Steve was using here: There's a 98% Chance Stocks Will Be Higher in 90 Days.
And in January, Jason's research led Steve to tell readers, "You should have your portfolio positioned for a flat stock market, at best, over the next two to three months." Two months later, the market had choppily traded down 2%. Learn more here: Where the Market Goes Next.
Market NotesTHE STRONGEST BEAR MARKET IN THE WORLD This week, we take our euro "mythbusting" to a new level. After all, the euro just hit a new level...
As we noted last month, one of the big myths in the marketplace is that despite the huge government debt problems plaguing Europe right now, its multi-nation currency, the euro, looks like it is holding up relatively well. We say, "Look again... But look at it in terms of gold."
You see, the problem with conventional euro price quotes is they value the currency against other weak paper currencies, like the U.S. dollar and the British pound. Gold, on the other hand, is "real money" (even "The Greatest Currency Trade of the Millennium"). But it's not used in the conventional calculation.
Today's chart uses such a calculation. It displays the euro in terms of gold over the past two years. As you can see, when priced in gold, the euro isn't holding steady at all... it is plummeting. Just yesterday, it registered a new downside breakout to close at an all-time low against gold. The glacier-like bear market of paper currencies versus gold continues...
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