This is it!

The last time we issued such an alert, was back in Auguest of 2007, when we wrote “The Moment of Truth“. In it we said

I deem the next 30 days as integral to my credence as an investment analyst… The fundamentals remain in check, and reasons for the rally only continue to build. It should also be considered that stocks by contrast have historically had some tough sailing through the fall months. Gold may also emerge triumphant if the cycle turns “deflationary” and gold holds its value while stocks take a hit, on what’s inversely often the weakest months for equities.

Over the following months Gold rallied from $675 to over $1000, while Silver went parabola from it dip of $11.75 to $21.50 – 83%! The only resistance was both meager and short lived, around the $850 and $16 level, respectively.

I am issuing a similar alert now. The second stage of the largest “Migration” stage of Gold has already begun.

I believe there are 3 stages: a) Denial: The longest and most durable rally [2001-2006], b) Migration: the current stage, which I believe will take gold well over $2000 [2007-2009] and c) Euphoria: When gold will probably double in a matter of months sometime in the next few years [2014?].

We said of Migration

As a breakout occurs, institutions and growth investors will run with it, extending the sector to its largest gains, probably well past $1000.

This will be followed by Euphoria. This is an interim-Euphoric stage when Gold may reach as high as $5,000. This will not be the ultimate Panic buying that could take Gold into 5 digits.

This may all seem abstract and far fetched now but a) we know how quickly things change in today’s economy (think Freddie Mac) and b) how historically such a scenario has plenty of room for materializing (think stocks in 1982).

If you do not yet own any gold or silver I suggest you go out and buy some. I will not cheerlead the precious metals ever again. This is it! I consider myself a value investor and I see value in the PMs, but only underneath a certain level. You must buy in before the rally in order to remain solvent.

Watch as all the Wall Street prior-deniers-and skeptics run into the precious metals along with the institutions and momentum funds.

[Note: I do see one more correction in the cards, (possibly around the $1,500 level). If for whatever reason you do miss this one, wait for the next, and don’t get emotionally lulled in by the rally.]

As we said a few months ago: Buy until your hands bleed!

For a Technical Outlook I suggest these articles on Silver and Gold


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