Gold Breaks Another Record High! We Called $1,500 Per Oz.April 20 | Posted by Matthew Clark | Inside Trader Highlights
Gold continues to smash record highs and once again it broke $1,500 per oz. in yesterday’s trading session. With the markets in an extremely emotional and volatile state over the recent wave of negative news that continues to support its case, are you really that surprised that the “King of precious metals” continues to lead the charge? We’re definitely Not!
In a recent article, “Gold Breaks New Highs – Could Push $1,700 By Year End” posted April 6, 2011, Elite Investment Group’s Kevin Monaghan clearly stated:
“Gold will now use the previous resistance line as its new support. If Gold can trade above that support line over the next few sessions, it could be a good indication that Gold is ready to again move higher. We’d even expect that Gold could test the new support level potentially causing it to bounce to the upside. If the breakout is confirmed, Gold could see a push to over $1,500″.
Great call Kevin! During yesterdays trading session this is exactly what happened and we now expect the rally to continue towards that $1,700 mark especially after the S&P spanked the United States with a “negative” outlook and a 1 out 3 chance of a possible downgrade over the next couple of years. Geithner get over it! It’s been a long time coming. With inflation still being out of control, the US Dollar collapsing (which by the way, continues to make earnings look better than they really might be) and QE2 coming to an end, it just makes sense that there is no reason for Gold to pull back right now.
What’s The Trade?
I certainly don’t have a crystal ball, but I do have a good idea as to what’s to come based on key economic data we’ve been paying close attention. Investors are using Gold and other precious metals as a safe haven or a hedge against a potential market correction. They’re also fleeing to precious metals because they just don’t feel like they have other options. If I had to lay my cards on the table, I’m staying long precious metals, particularly Gold and Silver, I’m staying short the US dollar, and I wouldn’t touch Bonds with a ten foot pole. As far as equities are concerned, I’m not taking drastic measures just yet as earnings season may help to push shares in my portfolio even higher, however as mentioned above, I’ve included precious metals as a hedge just in case…