Buy Precious Metals This Week … Here’s Why …

Hey There Income Hunters, 

 

The US is poised for the biggest change in the history of its monetary system in the months ahead — and you can make a fortune.

 

The insider trading scandal at the Fed is heating up and I believe it will lead to a much more dovish central bank. Not only that, but the Fed will end up being completely controlled by the US government.

 

This is the most bullish scenario you can imagine, and it is happening just as fundamentals for gold are improving anyway.

 

The sentiment is changing rapidly in Washington. Consider this recent blurb Fox News:

 

“Democratic progressives ramp up pressure on White House to deny Jerome Powell second term as Federal Reserve chair because they say it is key to Fed monetizing massive spending plans and winning midterms more.”

The probability of a Powell replacement is increasing every day … 

 

You know the replacement will be handpicked by Janet Yellen at the Treasury, so the administration can move forward with a plan to buy votes in the midterms …

 

Today I will share why now is the time to strike gold and how you can maximize your returns …

 

It’s an Ideal Time to Buy Gold Minders

 

There are  couple reasons I say that:

 

      • They have not been this cheap aside from the quick Covid spike in 5-years …
      • The trouble at the Fed will open investors’ eyes to the danger in holding dollars and bonds, and trigger institutional money out of financial assets into precious metals …
      • Energy has had a major run and with Crude near $80. This could trigger allocations out of energy into precious metals 

 

Let’s Start With Gold

 

Gold miners are at valuations that could trigger huge returns in the months ahead …

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There were four other times in the past seven years that a complete capitulation of positions in gold miners sent almost all miners below the 200-day moving …

 

Returns six months later averaged 65%

 

My recommendation:

 

      • Buy a Dec. 17 call spread on the VanEck Gold Miners ETF (Ticker: GDX) …

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GDX has been building momentum higher in the face of rising interest rates and a rising dollar.

 

When a stock doesn’t perform how it normally would be expected to, that is a powerful signal. This is a good location to put on a low risk/high reward trade …

 

As for the specific trade:

 

      • Buy-to-pen a $GDX Dec. 17 32/34 call spread with GDX between 30.5 and 31. Stop yourself out at a 20% loss maximum.

 

Here is the risk profile …

 

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      • On the upside, if GDX expires above $3, you can earn a 250% gain on this trade
      • You would earn the $200 difference in the strike, minus your cost, which in this example is $57.
      • Your net profit would be $143, divided by your cost ($57) for a 250% return on investment.

 

Bring It Home 

 

Gold has a lot of catching up to do after sentiment shifted towards Bitcoin and energy in 2021.

 

However, a dovish Fed and a shift in the narrative to even higher inflation and continued spending by the government will power-charge gold and the miners into year end and beyond. Get involved now while the risk/reward is so favorable.

 

Getting in early will make it easy to trade around a core position and continue to ring the register on the move up.

 

I’ll have more on these developments all week. Until then …

 

Live and Trade With passion My Friends,

 

Griff

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