Investing in Gold and Silver, 4 Working Days Left, Be a Part of the RUSH

Posted on September 12, 2007 , filed under Stocks | Print This Post

26 year high for spot price of gold in May 2006

Spot price of gold in September 2007

Take a look at these two charts. With gold currently at $711, we are less than $20 away from gold’s former 26 year high of $730 set during May, 2006. I still see that many PM stocks are a far way off from trading at the levels seen while spot prices were previously this high. This spells catch-up to me for PM stocks and has been the recent overwhelming theme of Raw Greed. My writing has been focused on finding fundamental investments from speculation and greed. This is about as speculative as you can get.

There is tremendous continued strength in the spot prices of gold and silver. It looks like gold may form a base above $710. We are also looking at a rapid drop in the USD Index. The $80 mark was a key psychological barrier. We are now 4 trading sessions away from a pending rate cut by the Fed and it looks like the market is pricing in the likely cut. Front page articles on Yahoo! Finance, like the one titled: Stocks End Higher on Hopes for Rate Cut add to the fervor.

Taken from the article:

“Bernanke didn’t really say anything about interest rates, but at this point the feeling on Wall Street is that it’s mandatory,” said Steven Goldman, chief market strategist, Weeden & Co., speaking about a rate cut.

I put in an order to buy Hecla Mining Company [[HL]] yesterday at $7.69. The stock shot up past my range of $7.50-$7.80 rather quickly. If you aren’t in on PM stocks because of the recent rapid appreciation, I urge you to take a small position in PM stock options to gain some exposure to the possible extended bull run.

For reference, here is the list of PM stocks that I am watching:

Barrick Gold Corporation [[ABX]]
Newmont Mining Corporation [[NEM]]
Silver Wheaton Corporation [[SLW]]
Gold Fields Incorporated [[GFI]]
Coeur d’Alene Mines Corporation [[CDE]]
Tanzanian Royalty Exploration Corporation [[TRE]]
Northgate Minerals Corporation [[NXG]]
IAMGOLD Corporation [[IAG]]
Hecla Mining Company [[HL]]
Pan American Silver Corporation [[PAAS]]

*Disclaimer: The author is currently holds positions in Coeur d’Alene Mines Corporation, Tanzanian Royalty Exploration Corporation and Northgate Minerals Corporation.

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