Be Prepared For A Shift: Out Of Oil And Into Gold

• February 4, 2005
• Derrick Hobbs

Below
is a chart of the Oil and Gas/Drilling industry versus the CRB Index over the
past 12 months.  It’s no hidden story that Oil is doing well, but in
the context of the CRB we need to keep this in perspective and know that
reversion to the mean is very common in the markets.  Oil up 42% while CRB up
8%…yes math majors, that’s a 34% spread! In fact if I put an overlay of gold
instead of the CRBZ it would be 4% or 38% spread from Oil.  What am I trying to
say?

 

Be prepared for a shift: Out of
Oil & Into Gold

 

Here is a gold stock that I’m
looking at right now in Newmont Mining (NEM).  This goldie is hitting a
giant support zone from 37.35-40.75, and there are 4 time cycles coming in right
here for a potential reversal to the upside.

 

 

Good night and have a great
weekend!

 

Derrik