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Golden 2008: A Shiny and Historical Welcome - Learn to Trade Options | #1 Options Trading Education

Golden 2008: A Shiny and Historical Welcome

Published on January 1, 2008

Golden 2008: A Shiny and Historical Welcome

January 1, 2008

A very very HAPPY NEW YEAR to all the OP readers and their families. May this new year and the years ahead bring lot of happiness, peace and love to you and those who surround you! Wealth is an outcome and may your investment/ spending actions result in accumulating wealth for you and your families!

Why I said historical welcome, in the recent history Gold has never closed a month above $800/ounce (Abs $$, not inflation adjusted)! If you study gold prices for monthly close, you’ll find that it is on rising trend and monthly averages has been higher and higher for the past several months. I have been bullish on gold and I still am. It is not designed for faint hearted or for short-term investments, it is “The symbol” of real wealth. Since the history of mankind evolution, gold has been the symbol of wealth, across nations in one form or other. It has been the real currency in almost all the civilizations.

600yeargold.gifHere is a historical 600 years gold price chart (Courtsey – Historical Charts of Interests). This is to give you a perspective that gold is no where near it’s peak in terms of 1998$ and has far more legs to run. I am not saying that we’ll see all this within couple of days or months, but I feel quite positive that we are yet to see a major golden bull. As most of my mentors advise, gold is never “invested”, it is accumulated and it is accumulated over a period of time. To understand gold’s history to satiate intellectual curiosity, here is the history of gold.

I receive many questions on how to invest in gold, so here is a site named “Gold-Eagle” that has lot of references, free newsletters, technical analysis and names of instruments that may help you “accumulate” gold. Of course, the most authoritative website is World Gold Council, that can help you understand trends, statistics and supply & demand perspective.

Oh BTW, the most populous nation on the planet earth, China, has overtaken US in Gold consumptions. Thanks to the economic liberalization (or is it to safeguard it’s own trillion dollar reserves to move from “paper” to “real”? you bet, it is). I’ll leave it to you to “Imagine what’s next”? It’s only IC of BRIC!

Unlike many other commodities, Gold is probably the only most widely traded commodity that has most of the quantity still available above earth since the first time it was mined.

A golden happy new year, welcome 2008.

Happy investing and profitable trading, OP

4 Comments

  • Andre says:

    Gold is looking like a great trade this year especially today with the GDX and other etfs on gold up 4 percent today.

    I was actually going buy the GDX jan 45 calls up 80 percent today

    do you think the GDX is a worthy trade

  • […] mentioned historical close for gold and now Gold is in new territory assuming it can close above $850 at the end of today. There is […]

  • OptionPundit says:

    Andre, I just posted my gains on GDX and also mentioned why GDX is my favorite underlying instrument to play golds’ move. GDX is worthy trade but I think you may have to time it properly. It will face resistance around $52 but then…a new territory. Think of it for a min, it was $52 when Gold was not near $860, it’s $49 when gold is flying, why is the gap? Wallstreet. GDX is “stocks”.

    Profitable trading, OP

  • Andre says:

    Guy Adami on fast money was talking about the GDX today
    he didnt like it because it doesnt directly track gold but rather it tracks the miners, he liked GLD but it doesnt have options available.

    but is there another gold etf with options availible

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