Invest In Gold, Trade Commodities

March 3, 2010 - PRLog -- GOLD




Gold prices were steady throughout February, look at Chart 1.  Evidence continued of institutional fund managers buying gold for their client portfolios as an alternative investment to stocks, US dollar and bonds.  New developments included China agreeing to buy 190 tons of gold from the international Monetary Fund.  This purchase seems to be bullish for the gold industry for the reason that not only individual investors desire gold but countries as well.
















Outlook

We believe a recent US dollar rally will fizzle and that should provide support to gold.  In fact it’s already happening.  Continued investment demand should support gold and propel prices towards its all time highs.



S&P500

The S&P 500 gained 2.8% as Greece's debt problems eased, company earnings rose of which most beat 4th quarter expectations, and the US economy continues to show growth.

Outlook

As the economy continues to grow, expectations for earnings growth should support investors to return to the stock market or increase their purchases.  We believe the US stock market will continue to trend higher as the US economy continues to recover and grow over these next few quarters.



WHEAT

Wheat prices rose as buyers took advantage of relatively low prices.  Prices could spike higher if delay in spring plantings or harvests occur.  Currently the United States has had a severe winter which may end up being a long one.  If heavy rains come to the farm belt this April and May then the farmers will not be able to get their equipment in the fields to both harvest the winter crop and plant seeds for the summer wheat crop.  This scenario occurred last year for which we saw wheat prices soar 25% in 45 days.

Other grains could be affected by Mother Nature such as corn and soybeans.  Battle for acres can occur too.  This is when farmers are deciding which grain to plant more of.  Usually they will plant more of the grain that is currently higher in value.  This strategy takes away acreage from the cheaper grain, which then could be in short supply for the up coming marketing year.

We will be watching this industry very closely as there may be some investment opportunities.



SUGAR

Sugar prices came under pressure this month as Brazil's harvest came to the market place.  Investors also took profits from the strong rally from last year as the price seemed to be over valued.



EURO

The Euro continued to lose value as concerns of Greece, Spain and Italy would default on their debt.

Prices finally came to support as those fears started to fade.  The European Union offered financial support to Greece troubles if there was a default.

The US Federal Reserve continues to support low interest rates in the US.  It seems to be that interest rates will stay ultra-low for a few more quarters.  Rates are higher in Europe by ¾ %, therefore those higher yields could put some pressure on the US Dollar in the short-term.  Oversold conditions could be supportive as well.

We will be watching the exchange rate between the Euro and Dollar very closely as there may be some investment opportunities.

Acquiring a financial option specialist can help you trade gold option contracts.  HB Group can be very helpful with their experience and knowledge with these financial instruments.  You could visit them at www.hbgroupintl.com.

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HB Group follows financial industry events and analyzes how products prices would be affected, and provide research regarding the variety of financial instruments that are available to individual investors. For more information visit www.hbgroupintl.com.