GOLD AND RESOURCE SHARES MARKET UPDATE 9TH APRIL 2010
Since the beginning of April gold has started to increase again and is now trading this morning at $1,154 (£754) an ounce. It has passed two resistance levels - $1,122 and $1,133 and it now holding strongly around $1,150 which is the next resistance level. Historically April is golds strongest month so I am hoping that it does not disappoint us.
Silver is still below the 2008 high of $21 but is now trading at $18.16 (£11.87) and appears to be holding well around this range. Silver is still undervalued compared to gold and as I expect gold to increase from here I also expect silver to follow.
The shares have had a good couple of weeks and I have received several phone calls from clients 'checking to see if their valuations are correct', but most importantly, should they be selling? There is obvious concern about a double dip and as we have been through the pain of 2008 we do not want to experience that again. Based on outside information; from many differing sources; the general opinion is that the general markets (including the resource sector) have further gains ahead and that this could last until June or July. It is likely that Gold will take a short breather now and may even consolidate a little lower before moving higher again. This also applies to the shares. Therefore, our recommendation is that we remain invested a while longer at which time we are then able to lock in profits and return some money to cash. For those clients on the Performance Service you will be contacted as soon as we have come to a conclusion regarding the markets.
However, should any investor feel that they would prefer to move some money to cash now then please contact us.
Oil has been moving higher and this is expected to continue to around the mid $90's. So much for the media comments that cheap oil is here to stay when it fell to $30!!
Copper is just under $3.60 which is only just below the 2008 high of $4.00 lb. A remarkable recovery from $1.40.
Regards
Elaine