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CPM Group Trade Signal - January 4, 2021

Commentaries & Views

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Time Stamp
Prices as of 9:15 a.m. EDT (14h15 GMT) 4 January 2021 $1,945.50 (Basis the February 2021 Comex Contract).

Direction: Stay Long, Buy

Target Price / Range: $1,970

Timeframe: 05-01-2021 to 20-01-2021


Gold was at $1,886.10 on 21 December, the date of CPM’s previous Trade Recommendation. We said to buy gold as a short-term investor with an initial target of $1,910. We also have been writing for some time that we expected that prices could jump as high as $2,000 per ounce in January or February, before falling back.

Gold rose about $50 this morning, 4 January. It rose in line with stocks, oil, other commodities.

We still expect gold prices to rise further in the next two to six weeks, and $2,000 may be a reasonable objective. Political developments in the United States over the next two or three days will weigh importantly on gold and other financial asset markets.

That said, with prices $50 higher in one day, the idea of a short-term pull back, to $1,900 or some other level, may well be realized.

Our advice to our investor clients would be to hold on to their gold, not take profits, but to buy shorter dated put options to protect against a short-term drop back in prices, and to profit from such. If prices dropped $50 the puts could be sold back to the market, a nice profit would have been generated, and the investor would still be long physical gold.

Note: Discretion should be allowed at +/- 0.20% of the price at the time each TR is issued from the target. Recommendations are valid until the target date or a new Trade Recommendation or message is issued by CPM


Disclaimer – Past performance is no indication or guarantee of anticipated future profits, and neither Kitco Metals Inc. nor CPM Group can accept any liability or responsibility for any loss suffered as a result of gold price fluctuations. Gold as a commodity is not a specified investment for the purpose of giving advice under the Financial Services and Markets Act 2000. Therefore this trade recommendation does not give rise to rights to claim compensation under the Financial Services Compensation Scheme. CPM Group is a registered CTA with the U.S. NFA and CFTC. At times the principals and associates of CPM Group may have positions in the precious metals, commodity, and equities markets. CPM Group also manages investment and industrial positions in markets for its clients.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.