Tag Archive | "commodities"

Gold Outlook Update For July and August

gold outlook update

(Photo Credit to: Bloomberg.com)

Since the Federal Open Market Committee minutes were released precious metals like gold and silver have been benefiting greatly from the commotion and rumors. While we have given you a Gold Outlook for 2013, much has happened in recent weeks. Consider this a gold outlook update, providing you with the recent changes and weekly progressions since our last post. We’ll take a look at what affected the precious metals market, current risks and even a little treat! This time around, we were able to get a hold of the ever-busy Michael Killian, co-owner/co-founder of Stock, Rock, and Roll to give us his input on the current gold market. So as you are easing into work this morning, catching this during your lunch break, or surfing the web under company time, take a look at the latest gold outlook update!



Gold Outlook Update: Current Standings

gold outlook update

(Photo Credit to: BusinessInsider.com)

Since posting our last few gold outlook articles, including Gold Outlook for 2013 and Gold Stocks, Who’s Hurting, Who’s Flourishing, and What’s Next, the precious metal has been riding a three-week high. We’ve recently been witnessing stronger levels and higher rallying gains. In the past week gold prices rallied 4.9% which has been the biggest gainer since October 2011. Even gold futures spiked 2.6% after Federal Reserve Chairman Ben Bernanke stated their highly accommodating monetary policy will be needed for the ‘foreseeable future’ citing low levels of inflation. We’ll look into Bernanke’s other remarks throughout this post, for now let’s see other gold trading updates. It’s good to see the gold outlook on a positive note, although it will most likely not last too much longer.



How the FOMC Minutes Affected Precious Metals

In the last week the Federal Open Market Committee released the minutes from their most recent meeting. Key points addressed included the asset purchase program and future plans for the Federal Reserve. While many of Bernanke’s comments were broad, they were still enough to affect the precious metals market. While the Federal Reserve leaves their monetary policy unchanged, the minutes and press conference had Bernanke foreshadowing a taper initiation for the asset purchase program by the end of 2013 concluding by mid 2014 if the economy continues to pick up as the Central Bank expects.

The asset purchase program actually caused some conflict within the committee as it was almost an equal split down the middle of those for the initiation and those against it. Half of the committee feels the state is still too weak, and it’s too early to start wrapping this program up. The other half feels its time to start preparing by scaling back purchases to avoid any potential negative consequences of the program, ensuring they do no exceed the anticipated benefits. They’ve seen how there’s been a decline in the unemployment rate since last September and the ongoing increases in private payroll. With the labor market improving, policymakers for the taper are confident with it’s initiation.

gold outlook update bernanke

(Photo Credit to: WashingtonPost.com)

While Bernanke and the Federal Reserve continue to debate the fate of the asset purchase program, members did agree that they will shed some light on their monetary policies in coming months, especially after Bernanke’s collection of broad and vague statements.

Bernanke himself can be seen as somewhat contradictory, as some even refer to his remarks as “dovish.” In the past few weeks as the focus was on the FOMC, Bernanke has flip-flopped back and forth between hinting at the start of a taper in addition to says the economy still had a long way to go and will require much more easing. Though some scratched their heads over these comments, his tone was definitely enough to affect Forex and Precious Metals markets. Thankfully it was in a positive regard, but what is Bernanke’s final consensus? Is he for the taper or not?



Should I Invest in Gold? Michael Killian’s Opinion

Since our last gold post, I was able to catch up with the knowledgeable co-founder of Stock, Rock, and Roll, Michael Killian. I wanted to pick his brain and see what his thoughts were with the FOMC and Bernanke’s role in the precious metals market and his opinion on investing in gold. After this recent gold outlook update, should you invest or hold off?

gold outlook update

(Photo Credit to: Bloomberg.com)

As we discussed the FOMC’s last meeting, Killian said,”…it seems like the economy has taken a step for the better. As a result, the U.S dollar is expected to increase in value.” He went on to explain how interested rates have increased and in turn yielding higher monetary returns to banks. He projects that in coming months the stock market should be doing better than it has been.

Following the FOMC I asked Killian if he would invest in gold or other precious metals at this time. In response he profoundly said, “There’s a saying, ‘buy the dip.’ The best time to buy is usually when everyone else is selling – especially with a hard asset like gold.” Of course, this statement refers to supply and demand. In the case of precious metals there is always a limited supply of these commodities in addition to a continuous demand.

“I think gold is a great investment at the moment,” Killian continues, “the upside potential surely outweighs the risk at the moment. In the short-term, prices will probably stay in the $1,200-$1,300 range for a while. As a long-term investment, gold is likely to rebound to previous highs.”

If you are looking for a quick-flip situation, this commodity is not for you. For those of you who have the ability to sit on an investment like gold for a while, you will more than likely reap the benefits as gold begins to rebound. As we concluded our conversation, Killian concluded by stating, “Now is a good time to capitalize on the low price of precious metals.”

Gold Outlook Update Wrap-Up

Well, it’s apparent that much has happened since our last gold post. While the FOMC’s committee attempts to find some middle ground in future meetings we can also expect a specific plan as to how they will approach their monetary policies from now on. Bernanke’s comments are still unclear, though we should be able to identify his side in coming weeks. For those of you debating on investing in gold, you heard it from a seasoned stock professional. As Killian said, ‘buy the dip’ and take action while everyone is selling and benefit from the low prices. Just remember you have to be willing to hold onto these investments with a long-term mindset!

What do you think? Will you invest in gold? What are your thoughts about Michael Killian’s remarks? Let us know!

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Suddenly Commodities Are Exciting Investments


Why Commodities Are So Profitable

It is not uncommon for some investors to turn their sights on commodities and keep them focused there for their entire careers. These investments can be very profitable. People are also drawn to their solidity. Investing in a company, even a respectable institution with years of solid performance behind it, requires a lot of confidence in abstract features and hopes.

Putting your money in something real, like oil or cotton, can provide a substantial foundation for confidence in your investments, the world may decide that it does not need a specific company and its stock will fail. The world will not suddenly stop needing, food, energy and construction materials.

Some Popular Commodities Now

The world of commodities is a big one but there are certain items that are most popular right now. Among these are several agricultural products, precious metals and anything related to energy.

Agricultural commodities include staples such as corn and wheat as well as other crops. The demand for these products has risen incredibly in the last decade. Various developing nations have recently crossed wealth thresholds that allow their citizens to divert more income to food.

Due to the destabilization of the world economy and the apparent arrival of inflation, demand for precious metals has skyrocketed. Gold is the most popular of these commodities right now. However, there are also profits to be made in silver, palladium, platinum and other scarce but useful metals.

Energy products have also gained importance. More people are driving cars and powering home appliances now. They need oil, coal, natural gas and alternative sources of energy to generate this power. Investments in these commodities have churned out significant profits in the last decade.

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Taking Advantage of Low Commodities Corn Prices


Commodities Corn Prices: A Changing World

commodities corn pricesRecent fluctuation in commodities corn prices have had investors worried that there could be rough roads ahead for the corn industry. Announcements from the scientific community have stated that corn may not be as healthy as was once though. While fresh corn has long been thought of as a vegetable, public opinion is slowly altering and many now consider it a grain, or a starch, instead. While the low-carb diet craze has faded in recent years, it still has enough followers that this has had an impact on commodities corn prices. To make matters worse, high-fructose corn syrup has been demonized by the media. This has resulted in more than simple bad publicity. A number of states and countries have completely banned the substance.


Commodities Corn Prices: Things Are Looking Up

While all of these changes may seem to indicate that corn’s stronghold on the commodities market may be coming to an end, investors may be jumping to sell their stock a bit too quickly. It is true that commodities corn prices have seen a drop. Nevertheless, many experts agree that this is only a passing phase. This cycle has been seen many times. When a food is found to have negative health effects, it instantly drops in popularity. Within months, or even weeks, however, the scandal is forgotten. Additionally, corn is still one of the most used ingredients in processed foods. While high-fructose corn syrup may be less popular than it used to be, there are a number of other corn substances that are used in almost every snack food in the world. The demand for corn flour, corn oil and corn starch has not faded. Chances are that corn will soon regain much of the ground it has lost. In the mean time, investors should take advantage of low commodities corn prices and buy their stocks quickly.

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Buying and Selling Commodity Exchange Traded Funds


Understanding Commodity Exchange Traded Funds

commodity exchange traded fundsCommodity exchange traded funds, or ETFs, are comprised of futures. These futures contracts represent the performance of the commodity. Commodity exchange traded funds are useful for hedging risk and getting involved in the physical goods market.

Basics of Commodity ETFs

As previously stated, the contracts in an ETF are representative of the value of the commodity. Investors do not trade the commodity itself, however. For example, if you purchase corn ETF, you are not buying actual corn. You are buying a collection of assets, which are backed by the physical commodity. This may sound confusing, and it does take time, research, and practice to get the knack of commodity exchange traded funds.

Buying and Selling Commodity Exchange Traded Funds

A good reason to buy a commodity exchange traded funds is if you have a hunch that some new discovery or innovation will spark a price jump. You might also hear of a drought or other natural phenomenon affecting crop supplies. These would be good opportunities to purchase some commodity exchange traded funds. You might be tempted to sell your oil ETFs if a major oil-producing nation is experiencing turmoil. Another reason to sell might be an oversupply of a crop, such as corn, due to an overestimation of demand. There are a multitude of reasons to buy and sell your ETFs. As you learn how to trade in this market, you will make mistakes. Eventually, you will develop a strategy that works for you.

Learning to trade ETFs is an intimidating prospect for many investors who have grown comfortable with basic stock trading. With some effort and practice, however, you will learn to navigate this market, as well. Expanding your portfolio to include these commodities is a good idea. You can diversify your investments and hedge risks by investing in commodity exchange traded funds.

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Increase Trading Success with Commodities Tips

Commodities Tips to Boost Your Trading Success

commodities tipsLearning a few commodities tips to help you trade can make you a smarter and more successful investor. Trading commodities can be risky, but when done properly, it can be a great way to diversify your portfolio. Do thorough research, and utilize smart investment strategies to make the most of your commodities.

Types of Commodities

Commodities are tangible goods whose shares are traded based on current market value. This differs from commodity futures, which are traded based on projected future value. Categories of commodities include livestock, crops, timber, oil, gas, precious metals, and other mined resources. Choosing which commodity in which to invest involves detailed research into past stock performance as well as indicators of possible future performance. Helpful commodities tips must always be accompanied by thorough research on the part of the investor.

Commodities Tips for Top Performers

The following commodities tips can help you to identify the top performing and most promising commodity stocks in which to invest. Of the grains sector, corn is a top performer. It has shown consistent growth for the last several years. Oil and gas are more volatile due to global turbulence, but have been lucrative in the last year. Gold is a complicated commodity that must be traded with utmost caution. It has shown record growth in the last 5-10 years. Particularly in the last year, values per ounce have been surging. There is concern, however, that the market is becoming overvalued, causing worry over a possible burst of the bubble.

Performing good research and paying attention to the market will reward investors in the commodities market with safe and lucrative trades. Investors should practice safe and steady trading strategies to maintain maximum risk protection and yield consistent profit. Using commodities tips can be helpful to giving you ideas to benefit your investment plan.

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Have Your Cup and Drink It Too with Rising Commodity Coffee Prices

Commodity Coffee Prices Are On the Rise

commodity coffee pricesWith commodity coffee prices on the rise, there is no doubt that coffee is a sound investment for many investors. Since the 1990’s, coffee has seen a resurgence in popularity across the Western world. Numerous high-end coffee chains have earned acclaim, and money, for their gourmet roasts and relaxing atmospheres. When the economy went into recession, it seemed like the coffee industry might suffer. Many people were no longer willing to pay five or six dollars for a cup of coffee. Instead of giving up gourmet coffee altogether, however, consumers have shifted to a more direct buying method. They are avoiding the middle man by ordering gourmet beans from the roasters themselves, and are brewing fresh coffee in their homes. While this shift does not bode well for the coffee chains, it is beneficial for many investors. Sustained sales are pushing commodity coffee prices higher and it seems that the coffee industry is as healthy as ever.

Commodity Coffee Prices: Protect Yourself from a Bad Growing Season

If you are interested in investing in coffee, there are a few things you should consider before making your first move. Commodity coffee prices depend largely on the health of the coffee crops. Coffee beans are grown in a number of key areas around the world, such as Indonesia, South America and South Africa. One way to avoid the negative effects of a bad growing season is to diversify your investments. Research the climate and weather in each country and find out which tends to be the most stable. You should put most of your money in beans from this country, but you should also invest in coffee from several other locations. This will help cut your risk in case weather changes or disasters cause commodity coffee prices to fall.

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