-- Posted Wednesday, 21 October 2009 | Digg This Article
| | Source: GoldSeek.com
Rick’s Picks
Wednesday, October 21, 2009
“Phenomenally accurate forecasts”
Our NYC-based correspondent Chuck Cohen, a consultant who specializes in gold investments, is so bullish on mining shares right now that he can barely contain himself. We’re hard-pressed to hold back ourselves, having recently disseminated a 492 target, 12% above current levels, for the Gold Bugs Index (HUI). We also expect the next surge in Comex Gold to push the December contract up to at least $1134, implying a rally of about seven percent from current levels. Here’s Chuck:
Ecclesiastes records,” There is a time for everything, and a season for everything for every activity under heaven." Today, King Solomon's wisdom can even be stretched to the buying of gold stocks, for there is a time for patience and waiting, and there is a time for action. This doesn't mean I am at all putting down patience, for it is critical for success in this or any bull market. If you lack it, you will tend to buy impulsively, sell out prematurely and be out when you should be in, especially in this historic market. I was taught this lesson back in 2004 when I grew impatient and bored with the lack of action in Virginia Gold, selling it for $.50, only to see it get bought out by Goldcorp shortly after. Within two years, Virginia was at the equivalent of $16.
But there is a subtle, yet major difference between patience, and, as the song goes, "Wishin' and hopin' and thinkin' and prayin, " as you wait for that theoretically perfect moment to buy. In the real world of stock investing, a buying alarm does not go off.
There is one caveat. This year some shares have gone up 5 or 6 times, and to buy them here is risky. But my key point is that after you have done your homework, considered all the details, and concluded that the investment seems right, you should simply jump into the fray. The main thing to keep in mind is that the junior gold shares are not meant for a quick profit or for trading in and out. You should be in them for the long haul, and if you miss the perfect buying point, over time it will end up seeming insignificant, especially if these stocks soar, as I expect them to.
Many Uncommitted
Why do I bring up this subject now? I can tell from my correspondence that although there is a lot of interest in the gold stocks, many of you have not yet made a commitment. Much of this caution presumably comes from two sources: 1) a persistently anti-gold media; and, 2) the "top-callers," gold advisory services that are always more absorbed with trying to pinpoint a top than encouraging them to stay the course. Together they sew doubt and fear, causing many would-be gold investors to dither.
Take it from me: Stop dithering and get off the fence. This article is intended as a gentle nudge to get you off your duff. In brief, here is why I believe the opportunity is ripe. 1) gold is at an all-time high; 2) some of the smaller companies have started to move up sharply; 3) gold has broken through a quadruple top at $1000 after a long consolidation and amidst a lot of skepticism; and, most importantly, on the long-term charts, gold’s price is rising within a powerful parabola.
Anti-American?
Taking that first step can a big one because the gold sector might seem foreign, even anti-American. But like learning how to swim, gold investing will soon feel comfortable, especially as you ponder our unreal monetary policies and the overwhelming economic problems that confront us. My advice? Take a deep breath and put in those buy orders, even if your natural impulse is to want to make that perfect entry and trade. That is not likely to happen.
As a wise investor once noted, if you get in within 10 percent of a bottom and out within 10 percent of the top it's not skill, but luck. But if you are going to get started and be successful in the junior mining sector, you’ll need to put aside that fear and uncertainty. At this point in the cycle the wind is at your back and the move upward should soon pick up in intensity.
In-and-Out Discouraged
And what about taking profits? Until we reach a vastly overbought point, as I mentioned earlier, trading in and out is rarely wise or profitable. First, you may have taxes and commissions to pay, and in the smaller exploration stocks wide spreads between bid and asked must be taken into account. Second, you have to be pretty sharp in your timing. and my experience is that it is not as easy as the advisory hucksters make it sound. But with any luck,, that will be a happy dilemma to discuss in a future article.
The landscape in the junior and exploration shares are about to change dramatically. Until now most gold investors have been conditioned to expect sharp setbacks. But once this thing blasts off, the pattern will change. Again, I suggest that you go back to look at the Nasdaq from 1987 to 2000 to see how its pattern of sharp sell-offs eventually morphed into a buying frenzy. Sooner or later this will happen in gold, except that it will be even crazier, and go on for a longer time.
And a word about my services: I can help you get started with a coherent investment strategy. If you have any questions, please contact me by clicking here. References available.
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Information and commentary contained herein comes from sources believed to be reliable, but this cannot be guaranteed. Past performance should not b construed as an indicator of future results, so let the buyer beware. Rick's Picks does not provide investment advice to individuals, nor act as an investment advisor, nor individually advocate the purchase or sale of any security or investment. From time to time, its editor may hold positions in issues referred to in this service, and he may alter or augment them at any time. Investments recommended herein should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company. Rick's Picks reserves the right to use e-mail endorsements and/or profit claims from its subscribers for marketing purposes. All names will be kept anonymous and only subscribers’ initials will be used unless express written permission has been granted to the contrary. All Contents © 2009, Rick Ackerman. All Rights Reserved. www.rickackerman.com
-- Posted Wednesday, 21 October 2009 | Digg This Article | Source: GoldSeek.com
