The Best Trade In Precious Metals Right Now [SPDR Gold Trust (ETF), iShares Silver Trust (ETF)]

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May 12, 2014 2:48pm NYSE:GDX NYSE:GDXJ

gold silver metalsLarry Edelson:  A few weeks ago, in my March 31 column, I told you that …


>> I am 100 percent confident precious metals will bottom this year and resume a new leg to the upside.

>> That the extreme emotions right now regarding gold and silver are typical at major turning points.

>> That all the underlying fundamental, cyclical and technical conditions for a new bull market in gold and silver are in place. The most important: The rising tide of the war cycles and global geo-political stress.

I also told you that while the short-term swings are always extremely difficult to pin down — and even far more difficult when entering a period where a major trend turn is expected …

I will get you as close to the bottom as humanly possible.

Naturally, my readers will get the first buy signals.

And they will get the very first high-powered recommendations as well.

But I won’t leave you completely at the station. In fact, today I am going to give you an update on the latest action in gold, silver, platinum and palladium.

Let’s start with gold:

On the surface, gold looks weak again. Over the past several trading sessions, it’s managed to rally as high as $1,315.80, but promptly fell back to the 1,284 level.

The swings are wild. The bulls and bears in gold are duking it out more than I have seen in a while. Again, typical of a major turning point.

At the same time, the main driving force — the ramping up of the war cycles — is front and center, with a new development: Extreme tension between China, Japan, Vietnam, and the Philippines over the Spratly Islands and South China Sea — is now rising to the surface as well.

Here’s what you want to keep your eyes on in gold:

Bigger picture: As long as gold holds $1,268.40 on a nearest futures basis (roughly $1,267 spot), gold should whip back and forth, but begin a move that will eventually take it first to $1,449 and then to $1,657 (then pause, pullback and then rally even higher).

Short-term: There is support at $1,272 and resistance at $1,331.

And here’s what you should be watching in silver:

Bigger picture: As long as silver holds $18.68 on a nearest futures basis (roughly $18.64 spot), silver too should whip back and forth, but begin a move that will eventually take it first to $22 and then to $28 (then pause, pullback and then rally even higher).

As I’ve mentioned in the past, make sure you have cash ready to deploy.

Specific recommendations are reserved for subscribers.

Also get ready to speculate on the unfolding new bull market in gold and silver. I myself am gearing up to make more money in gold and silver over the next few years than I have since their late 1970s bull market.

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Platinum and palladium are shaping up to be as profitable as gold and silver are, if not more.

Now, let’s go to two metals I haven’t discussed in a long time. Platinum and palladium.

Let me start by putting it this way: These two metals are now shaping up to be as bullish and as profitable as gold and silver are, if not more.

First, platinum and palladium are the two most widely used of the platinum group of metals, or PGMs. And demand is set to rise … while supplies are limited and politically unstable.

The chief driver behind their demand is their increased use in pollution control devises, especially catalytic converters, where growth is exploding  exponentially, due to China’s and India’s auto markets and to increased mileage efficiency mandated by policy makers globally.

In fact, the automotive sector now accounts for as much, if not more, than 38 percent of the demand for palladium and 71 percent for platinum.

In addition, China has become a huge market for platinum jewelry, making up nearly 70 percent of global demand.

But here are the real kickers:

 Russia accounts for as much as 54 percent of the world’s total mine production of platinum and palladium … while South Africa accounts for as much as 75 percent of platinum production and 38 percent of palladium production.

At the same time …

 The ore grade of the platinum group metals, that is the amount of the metals found in ore, is declining rapidly, with a plunge of more than 50 percent in ore grades in Russia and South Africa combined since 1998.

But most important of all are the war cycles. Besides the increased use of these metals in high-tech military equipment, there is the very real chance that we will see Russia sanction the West by withholding part, or even all, of its platinum group metals from the market.

Again, specific recommendations for platinum and palladium are reserved for my subscribers. For now, I merely want to give you a heads up that these are two metals you will not want to ignore if you intend on maximizing your profits in the next leg up in precious metals.

I end with the same message as last time: Stay tuned in, very tuned in, to all of my writings.

If you do not, you may miss the most explosive turnaround to the upside — ever — in the precious metals sector.

Larry EdelsonWritten By Larry Edelson From Money And Markets

Money and Markets is a free daily investment newsletter published by Weiss Research, Inc. This publication does not provide individual, customized investment or trading advice. All information is based upon data whose accuracy is deemed reliable, but not guaranteed. Performance returns cited are derived from our best estimates, but hypothetical as we do not track actual prices of customer purchases and sales. We cannot guarantee the accuracy of third party advertisements or sponsors, and these ads do not necessarily express the viewpoints of Money and Markets or its editors.


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