My complete gold watchlist

What makes you think gold is a good short above 500? I was thinking gold & metals could be one of the biggest gainers, *especially* from Apr 2006-Apr 2007, which is my estimate of when the market is due to hit bottom of its 4-year cycle. Just curious. Always like to hear other’s opinions.

Hi Jack,

$500 is a psychological milestone. If gold can maintain an above $500 price for 6 months or more it signals a green light for many individual investors. This will drive, quoted from one gold analyst as, “the beginning of a Mega Bull Run”. As with all bubbles it won’t last. Gold mining companies will rise slowly but drop fast.

Best,

Andy

Thanks Andy. And, nice going on CAL, BTW.

I like your site, but your analysis above seems odd. It seems that you are saying that if Gold can establish itself above a psychologically important price barrier, then this would be a green light to short gold stocks. Or am I misunderstanding?

Perhaps you mean that stocks like GG, IAG etc. will only reach your short targets at the very climax of the gold bubble–after Gold has climbed much higher from the $500 price.

Regards.

Mike

[…] Gold is on its well on its way to $500. Gold is currently trading at $484. I wrote an earlier article on September 24th, 2005 called Gold to $500? I discussed the effects of gold at $500 and what to watch out for once gold crosses the psychological benchmark. Here is a link to my complete gold watchlist with long term price targets and strategy. I continue to believe that the question of whether gold will break $500 is not if, but when. An important note to my strategy for gold is not to enact any short strategies until technical and institutional buying has slowed down and speculative buyers have come out in full force. I would wait until gold has taken a major jump over $500 for at least 6 months-1 year before shorting. If a bird flu pandemic materializes, I would advise to do the exact opposite and instead build a sizeable gold position. […]

[…] The market has seen a huge surge in gold prices in the last week. Gold is now approaching $600 and is currently trading at $585. I believe we may see another round or two of profit taking before we eventually break $600. I am keeping an eye on AUY, Yamana Gold, Inc. and BGO, Bema Gold Corporation. I was in BGO earlier this year at $2.80 and I sold out at $4.03. BGO is now trading at $4.56. After watching both stocks, I believe AUY has risen more aggressively than BGO and is more prone to price swings when the price of gold drops. AUY is definitely heavily influenced by speculation on future earnings and a continued rise in the price of gold. If I were to choose a gold mining stock, I would choose to invest in AUY over BGO during the rush to $600 and above. AUY went public in early 2004 and there is more opportunity for a young stock like this to appreciate with an impending mania and overly eager investors who attempt to look for the next bargain gold stock. Since I am bullish on gold and do see the metal breaking $600 in 2006, I will likely take a position in AUY if gold drops under $550. I would expect AUY to trade at low $8’s or just under $8 if gold drops under $550. Among the gold stocks on my watchlist, I also believe GG, Goldcorp, Inc. may be a good short term investment, I expect GG to drop to the $25-$26 range if gold drops under $550. […]