Gold Tops $600!

Gold finally touched another round number. It traded above $600 for the first time in Years, and the Gold (together with Silver and Copper) market looks stronger than ever. The stocks had had a bit of a sell-off in the last couple of months, but have snapped back up. ASA is trading near it's all time high set in the beginning of the year. NEM looks a bit weaker, but if you well diversified, or into Gold thru GLD, the Bullion Price Tracking ETF, you shouldn't worry too much about a stock or two.

Demand from Asia is the story behind the move to $600. China and India continue to be top buyers of the metal, and together with the riches of the Middle East, who find every day that they are sitting on a bigger pile of cash, from their Crude sales, The Gold market has fine fundamental support. But I always take these explanations with a grain of salt. My take is more to buy pullbacks, and right now I am waiting for a bigger sell-off to get back and establish Gold Positions. The market looks extended, and a break would probably do the bulls good, in shaking off the weaker hands. In the meantime, there are plenty of great opportunities-US, Japan and Emerging Markets, all are in rally mode, and a diversified portfolio, not concentrated in any sector too heavily, looks the best bet, when you compare the risk/return.

A Gold stocks ETF is in the works, but hasn't been launched yet. Will keep an eye out and let you know if there are any new developments.

Sanjay John G.