Another Gold Profit Opportunity?

Here's How to Profit Off Last Month's Fed Minutes

Gold got smacked hard last Thursday. The precious metal dropped $22 an ounce right after the Federal Open Market Committee (FOMC) released its minutes for last month's meeting. It fell another $25 in overnight trading. It seems a few members of the Fed thought that if everything worked out, they might be able to ease off the quantitative easing (QE) gas pedal sometime later this year. Now that's funny… I guess some people can't take a joke. Instead of laughing, some people sold their gold… They're thinking that if the Fed is serious about stopping all the QE, there will be less inflationary pressure and fewer reasons to own gold. But here's the thing… Fed members talking about cutting back on QE is like senators and congresspersons talking about cutting the deficit. It's not going to happen. They can talk about it. And all that debate makes for fun political theater. But once a country starts down the road of debt monetization, it doesn't turn back… ever. Sure, the Fed can set targets – like 6.5% unemployment, 2% inflation, or some acceptable rate of economic growth – for when it's time to ease off the QE accelerator. But it's just a show to convince the masses that the Fed knows what it's doing and is in control of the situation. Just like the show Congress puts on whenever the issue of "spending cuts" is put on the table. Yet, the national debt time-bomb just keeps ticking away. And the QE pedal will remain pressed to the floor. Lol.. i love this part: Congress is going to continue spending money it doesn't have… The Treasury is going to continue issuing bonds to borrow the money to pay for the deficit spending… The Fed is going to continue printing money to buy the bonds the Treasury issues to keep interest rates low… And all that new money is going to continue pushing down the value of the dollar and pushing up the price of gold. Now, consider that the central banks of Europe and Japan are doing the exact same thing, and ask yourself if it makes more sense to sell gold or to buy it. Take a look at the following chart…   At just over $1,650 per ounce, gold is resting right on its longer-term support line going all the way back to January 2011. There's additional support just below at $1,620, followed by even more support at $1,550. Last week's drop in the gold price looks like a good buying opportunity for the metal – especially if you missed the chance to buy it the last time it was down at this level. Best regards and HUAT AH! James - K.I.S.S. Investor Keep Investing Sweet and Simple :D

Buying Opportunity for GOLD Optimists

It's a well-written article comparing Gold Stocks (Index) to the price of Gold. Can take a look.. Another "Once in a Decade Buying Opportunity"

It was another tough year for gold-stock investors. With stocks up 12% and gold up 5% last year, you might think gold stocks enjoyed a solid year in the plus column, too… But you'd be wrong. Gold stocks, as measured by the AMEX Gold Bugs Index (the HUI), were down 15% in 2012. That poor performance follows on the heels of a 10% loss in 2011. So after two years of dismal returns, investors are once again tossing out the bargain-priced gold miners and giving the rest of us another "once in a decade" buying opportunity… It's not supposed to happen this way. Obviously "once in a decade" opportunities are only supposed to come along, well, once every 10 years or so. But we already had one of these moments in gold stocks last year. Last May, gold stocks were trading at their cheapest value relative to gold as they had been at any other time in the past decade – except for the October 2008 financial crisis. Anyone who took advantage of the setup I noted at the time could have made up to 40% in just four months. The same condition exists today. Take a look at this chart comparing the HUI to the price of gold… The chart is nearly back down to where it was last May. Mining stocks are dirt-cheap again. Yes, they can get cheaper from here. But the reward far outweighs the risk at this point. After all, many of the big names in the mining sector are trading at single-digit price-to-earnings ratios and are paying dividends of more than 2.5%. (Compare that to the S&P 500, which trades at 14 times earnings and yields just 1.8%.) Foolish investors are making a mistake by selling their gold stocks here. Now is the time to buy. If the sector performs as it did following last year's "once in a decade" buying opportunity, mining stocks could be sharply higher just a few months from now.

Gold Investing by Strait Times Invest Section

Just this sunday, i read from the Strait Times invest section on why analysts expect price to continue to rise and the various ways to take part in this.

This is quite similar to the previous post i written months ago: http://kissinvesting.blogspot.sg/2012/05/how-to-invest-in-gold-in-singapore.html

Nevertheless, i also wish to share with you all on what was on the newspaper in case you missed out the goodies...

• Physical Gold
  - Available at UOB; offers a variety of different sizes.
  - Buy-Sell Rate set by UOB daily
  - Investors can hold onto the Gold physically but be mindful of storage costs if you deem it unsafe to place it at home.
  
  
• Gold certificates
  - UOB issues the certs in multiples of 1kg
  - No expiry, used in exchange for cash/gold
  
  
• Gold savings accounts
  - Available at UOB & Citibank
  - Converts your savings into grams of gold!
  - Approved under CPFIS
  
  
• Gold ETFs (GLD US$)
  - SPDR Gold shares, listed in Singapore Exchange.
  - 1 lot = 100 shares
  - Denominated in USD
  - Popular for investors who want exposure to gold w/o taking delivery of the gold physically
  
  
• Gold-related equities and equity funds
  - Schroder AS Gold and Precious Metals Fund
  - DWS Noor Precious Metals Securities Fund
  - LionGold
  - Take note that equities may have low correlation to the Gold Price as they are affected on other factors like market sentiment, closure of mines etc.)
  
  
  
• BullionVault

After searching for quite some time, i found out that GoldBullion.com has all the desirable features combined together...

1. Highly liquid exchange for buying/selling Gold = Best for trading purposes/easy to sell when necessary (Compare that to selling physical gold, the other party get a cut of the commission first =/)
   
2. Fees are kept to a minimum because of the bulk volume they are handling.
   
3. They have a daily audit & endorsed by World Gold Council so it is definitely safe!
   
4. Only Investment grade Gold and Silver is taken into consideration so no worries about fake Gold or something...

There are still many benefits untold... but best of all, opening an Account is FREE (you only have to deposit funds IF you wish to purchase anything)... so i suggest you do it here right now! :)

Cheers & Happy Gold Investing to You! $_$

GOLD Breakout $_$ on 28/8/2012

This is exactly the moment i am waiting for...

The breakout in gold is here. It's time to be long gold. Back in 2011, gold enjoyed a big rally. As the European debt crisis grew worse, prices shot from $1,550 an ounce to a high of around $1,900. This big rally was followed by a big decline… one that took gold back down to the $1,550 level. From May through July, gold held steady around the $1,550 level. It then began trading in a tight price range. In this range, gold's day-to-day volatility fell to its lowest point in over a year. These periods of tight price ranges and low volatility often precede big price moves… Gold has been coiling for a while now – storing up energy for its next big move. All that's happened so far, though, is a big rally in the frustration level of gold bugs as we wait… week after week… for a bullish resolution to this pattern. Now,gold is approaching the apex of its triangle. So a decision-point is near. That "decision-point" arrived the next day… Wednesday's comments from the Federal Reserve led the market to think more financial stimulus is on the way. That resulted in a selloff in the dollar and a rally for gold. The metal shot out of its trading range. Take a look… Over the very short term (two to 10 days), gold is likely to pull back near its breakout level. Markets just like to frustrate traders before moving substantially higher. So if you're already long gold, you can expect to give back some of your gains over the next week or so. But the longer-term picture is clear. Gold has good fundamental reasons to move higher. And it has registered an important price breakout. You can trade this rally with a gold fund like SPDR Gold Shares (GLD) or Swiss Gold Shares (SGOL)… or with a quality gold miner. Gold stocks are incredibly cheap right now… and could rally triple digits over the next year. Names to consider here are Goldcorp (GG), Barrick (ABX), or Yamana (AUY) in the U.S. As for Singapore, You can take a look at my previous blog post here. Thanks to paikia, he helped on some clarification on the SPDR Gold ETF (http://www.spdrgoldshares.com/sites/sg/): the lot size is just 10 shares so at the current price of $162.03 = US$1620.30. That seems comfortable for most investors :) Whatever method you choose, make sure you're on the right side of the market. Right now, that side is long.