Uncover How You Can Profit From Soaring Gold Prices?

July 26, 2011 - PRLog -- Recently, debt fears on each sides of the Atlantic sent gold over the $1,600 level for the first time ever. The yellow metal has risen steadily since the start of 2009, when it had been trading at a little much less than $900 an ounce. And gold's advance has accelerated of late. The price of gold elevated 21% in the year's first half. As well as using the decline to $1,587.30 lately, the yellow metal is up 7% in the last month.

Many traders and investment pundits are claiming this gold-plated celebration is destined to finish. Once the Eurozone gets its home in order and our elected leaders in Washington lastly attain a federal spending budget accord, these naysayers say the price of gold will plummet. Go to http://www.silverdollar.cc for more profitable silver and gold tips.

But I think they are incorrect. Gold is not going to crash. In reality, it is not even going to hold steady at present ranges. The price of gold is destined to soar throughout the next six months to nine months. And I'm going to show you the best method to hitch a ride on this rocket.

There's a vibrant side to international debt fears. I've been analyzing gold miners along with other natural resources investments to get a long time. Now, when I'm analyzing precious metals related investments for my web site, you will find particular monetary indices that I prefer to research. And I particularly prefer to see how every of those indices behaves against one another. Read at http://silverdollar.cc for unique silver and gold tips.

One of the most useful - and telling - of those relationships will be the one that compares the price of gold to the U.S. Standard & Poor's 500 Index. To make this comparison, I use two exchange-traded funds (ETFs) as "proxies" - stand-ins - for every of those investments. The SPDR Gold Trust  symbolizes the price of gold and the SPDR S&P 500  can serve as a proxy for the broad stock trading game.

If we look at what has occurred over the past six years, the trend is indisputable: Thanks to the U.S. Federal Reserve - first simply because of aggressive rate cutting by former Fed Chairman Alan Greenspan, and then due to the massive debt expansion engineered by successor and present Fed honcho Ben S. Bernanke - gold is in a obvious uptrend.

All of us know that U.S. stocks endured a dreadful freefall in late 2008 and early 2009 - only to launch into a V-shaped restoration that turned into one of the most potent bull market rebounds in U.S. history. But if we factor out that dizzying whipsaw move, the bottom line is clear: Despite Bernanke's unbridled money printing, U.S. stock prices are lower today than they were back in 2007, once the international monetary crisis began.

This woeful period for U.S. investors has been very bullish for gold traders. Even more interesting - and bullish - is how gold has responded to bear market moves for stocks: Throughout probably the most sizeable share sell offs, we saw strong spikes in the price of gold.

Exactly why is that bullish? It's actually very simple. Government authorities around the world have taken on huge amounts of debt. That's not a dilemma that can be solved overnight. And the more time it takes to fix, the higher the odds that we'll see a sovereign debt default whose fallout will probably be far greater than anyone now can expect.

While we saw lately, just the fear of a sovereign debt default was enough to tip stocks into a nosedive. And any such free fall will clearly be good for the price of gold, which will power higher in the very midst of sizeable stock sell offs.

In the very near term, if government authorities are able to help allay debt fears, we could see a period of relief for gold prices. But there is no method to eradicate all this debt in a short period of time. That indicates this issue will resurface over and over.

Therefore long-term, the global sovereign debt crisis will probably be very bullish for gold. As we saw, there is a relationship among stock prices and the price of gold that gives us a method to predict just where gold prices may be headed. Now is really a great time to buy gold for your investment portfolio while the gold prices are still reasonable. http://silver-dollar-values.net has all the details for a precious metals investing decision.

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