How to profit from the gold boom

  1. 9,081 Posts.
    Here's how I play it - with a degree of safety (I hope)

    I only invest in gold producers - while explorers may run, the risks, for me, are too high.

    As the number of producers dwindles as result of takevers ( R.I.P: Normnady; Hill 50 & Aurion) institutional money in those stocks will seek another home in producing gold stocks to get their desired weighting in the increasingly important gold index.

    Hence the big moves in stocks like Newcrest and Lihr.

    It also accounts for the huge volumes and price increases in CRS - you can bet that displaced institutional gold funds are finding a home in stocks like CRS.

    Another gold producer that is looking good on the charts is Gympie Gold. It has done quite a lot of consolidating in the $1.00 to $1.15 range and looks like it is getting set for a breakout.

    I have held shares in all of these gold producers (NDY; NCM; AOR; LHG; CRS; GYM) and the rewards have been there.

    I currently only hold AOR CRS and GYM - and will, like the Institutions, be looking for other good gold stocks (producers only) with my eventual AOR proceeds.

    The gold price is, in my view, on the cusp of a major breakout. Look for that all important close above $327.50 - and then fasten your seatbelts.

    Gold may have a bit more work to do before it breaches that level and it would not surprise me if there was quite a strong retracement prior to that critical level being successfully challenged.

    Then again, with world tensions on a razor's edge, it could be sooner rather than later.

    Then we will really be in a "boom boom "gold market which will herald the end of the 20 year bear market and be ongoing for not months, but years.

    Gold must be the place to be.

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