$1,200 Gold By The End Of 2008
by Lannie Cohen
June 2008
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The price of Gold is $870 an ounce as of this writing. That is well off it's all time high of $1033 made just three months ago. What is driving prices? The primary factor is that Gold trades opposite the US Dollar. As the US Dollar declines, gold usually increases in price. Even today, the European Central Bank has left rates unchanged and has indicated actually raising rates as soon as next month! This statement is intrinsically bearish the US Dollar and consequentially bullish for Gold.
Recently there has been a lot of talk by the media and government officials about how the economy is back on track and that the worst is behind us. It is my opinion that this recent move up in the US Dollar will be short lived and will be headed back down toward the 60.00 level in the very near future (Current price of the June US Dollar Index is 73.80).
The current price levels and current time frame are offering immediate opportunities, right now, and we are implementing very specific strategies see below), call 1-800-876-8050 for details.
Here are some additional factors to make the case for buying Gold now:
1. INFLATION: All the new money the central banks of the world are printing has to go somewhere, if there are more dollars to buy a limited number of goods, it means higher commodity prices.
2. ASIAN ECONOMIES: 4 Billion people are now competing for the same goods with the US, once again INFLATIONARY.
3. US DOLLAR: Continues the downward spiral toward new lows, looking at an eventual price of a $2.00 Eurodollar. Deficits from the war, slow economy, billions of new dollars printed has diluted our currency, all the worthless junk derivatives the fed has purchased from the failing banks.
4. FAILING BANKS: The financial system is broken beyond repair, many banks are broke! Most banks have some type of derivative exposure, weather sub prime, collateralized debt, credit default swaps, CDSs, CDOs, SIVs whatever you want to call them, this exposure has grown to $596 Trillion!! Banks are begging for relaxed regulations on reporting these worthless vehicles. Bear Sterns was bailed out, not just for Bear Stearns, but for JP Morgan as well. If Bear folds, they all go was the fundamental thinking. How long can they hold this house of cards together is the question we must ask ourselves? We can wake up on any given day to massive failures.
5. GOLD-CURRENCY OF CHOICE: When uncertainty prevails with existing economies and paper money, gold is always and has always been a safe haven for wealth, on a global basis.
6. TERRIORISM: Not just Iraq, Iran, & Afghanistan, now the biggest threat of all-PAKISTAN, whose nuclear powers are in the sites of Al Qaeda.
7. GOLD CERTIFICATES: Gold may ultimately be tied into to the US Dollar to finally stabilize the currency, which would project it even higher than $1200.
8. STAGFLATION: Higher prices in a slower economy, the worst of both worlds
9. GOVERNMENT REPORTS: We can no longer accept what is being reported by the government regarding economic statistics, particularly with the big three: Unemployment, Consumer Price Index and Gross National Product
10. SEASONAL LOW APPROACHING INTO EARLY JUNE (See red line below)
December COMEX Gold Futures 5 and 10 year seasonal
(Past performance is not indicative of future results)
11. CRUDE OIL FACTORS: Gold is currently priced at a discount to Crude Oil and expected to re-gain in price as Crude oil rises.
NYMEX Crude Oil to COMEX Gold monthly ratio spread.
12. S&P 500: The S&P 500 has had a devastating decline in value highlighting the true value of Gold and current economic conditions.
CME S&P 500 to COMEX Gold monthly ratio spread.
How To Buy Gold Futures and Options
There is a 100-ounce contract where every $1.00 move is equal to $100.00. For example, if you buy 1 contract at $900.00 and it moves to $910.00 you make $1000.00 There is also a 33-ounce contract available where every $1.00 move is equal to $33.00. Same $10.00 move up would be $330.00.
You have the ability to place sell stop orders below your purchase price in an attempt to minimize you losses.* For example, if you buy one 100 ounce gold contract at $900.00 and want to risk $500.00, you would place a sell stop at $895.00. Same $5.00 stop example on a mini 33 ounce gold contract your risk would be $165.00. (Risk-reducing orders and strategies are used in the form of stop-loss orders which are intended to limit losses to certain amounts may not be effective because market conditions may make it impossible to execute such orders.)
There is no length of time you are obligated to hold the contract you purchase and there is no penalty to sell it before expiration. Many trade futures contracts throughout the trading day, while others hold their contracts for the long term. You must determine what your suitability is for trading and your personal comfort levels.
We also have a “Scale- In” method of buying at set dollar amounts. This strategy buys into declines and sells into rallies with standing orders. In this manner, you remove all emotion from your trading and it forces you to buy into declines and sell into rallies** (We have developed a very specific approach to this strategy, call for details).
Finally there are Options on Gold Futures available that limit your total risk to the amount you pay for the option. There are numerous strategies available with options.
Minimum Requirements To Get Started
Margin Requirement (good faith deposit)
100 ounce contract = $4,388
33 ounce contract = $1,485
Options = $1,000 - $3,000
Lannie Cohen, President
Managing Founder and President
Capitol Commodity Services, Inc.
www.ccstrade.com
lc@ccstrade.com
317-848-8050 Tel
317-848-8060 Fax
For more information about trading futures and options, or for a personal consultation to determine which strategy is right for you - 1-800-876-8050.
*FOR A LIMITED TIME ONLY ** Call today and ask about our special GOLD commission rate,* *800-876-8050*.
Capitol Commodity Services, Inc. was established in 1983. We have been servicing futures traders for over 25 years! If you are new to futures trading, we will help you every step of the way. Experienced traders can utilize our exclusive proprietary trading tools. Our rates are competitive, without skimping on the amenities. Our clients say they enjoy working with us and love the personal attention.
Lannie Cohen, managing founder and President of Capitol Commodity Services, Inc.(CCS), has 29 years of investment experience. Prior to the formation of CCS, Mr. Cohen worked for Merrill Lynch in both the Indianapolis office and at the Chicago Board of Trade. Mr. Cohen is currently registered with the National Futures Association and the Commodity Futures Trading Commission. Mr. Cohen holds a B.A. degree from The Kelley School of Business at Indiana University and serves on the boards of USA Harvest and Indiana Harvest. He can be contacted by email at: lc@ccstrade.com, website www.ccstrade.com or telephone 317-848-8050/800-876-8050.
Disclaimer
THERE IS A RISK OF LOSS IN FUTURES TRADING AND IS NOT SUITABLE FOR
ALL INVESTORS. ONLY RISK CAPITAL SHOULD BE USED WHEN TRADING FUTURES.
PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS.
* THE PLACEMENT OF CONTINGENT ORDERS BY YOU OR YOUR TRADING ADVISOR, SUCH AS A "STOP-LOSS" OR "STOP-LIMIT" ORDER, WILL NOT NECESSARILY LIMIT YOUR LOSSES TO THE INTENDED AMOUNTS, SINCE MARKET CONDITIONS MAY MAKE IT IMPOSSIBLE TO EXECUTE SUCH ORDERS.
** DISCLAIMER: Capitol Commodity Services, Inc.(CCS) does not warrant the correctness of any information herein or the appropriateness of any transaction. The contents of this electronic communication and any attachments are for informational purposes only and under no circumstances should they be construed as an offer to sell or a solicitation to buy any futures contract, option, security, or derivative including foreign exchange. The information is intended solely for the personal and confidential use of the recipient of this electronic communication. If you are not the intended recipient, you are hereby notified that any use, dissemination, distribution or copying of this communication is strictly prohibited and you are requested to return this message to the sender immediately and delete all copies from your system. All electronic communication may be reviewed by authorized personnel and may be provided to regulatory authorities or others with a legal right to access such information. At various times, CCS may have positions in and effect transactions in securities or other financial instruments referred to herein. Opinions expressed herein are statements only of the date indicated and are not given or endorsed by CCS unless otherwise indicated by an authorized representative. Due to the electronic nature of electronic communication, there is a risk that the information contained in this message has been modified. Consequently, CCS cannot guaranty that messages or attachments are virus free, do not contain malicious code or are compatible with your electronic systems and CCS does not accept liability in respect of viruses, malicious code or any related problems that you may experience. Trading in futures, securities, options or other derivatives, and OTC products entails significant risks which must be understood prior to trading and may not be appropriate for all investors. Please contact your account representative for more information on these risks. Past performance of actual trades or strategies cited herein is not necessarily indicative of future performance. Privacy policy available upon request.