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AGE Gold Commentary is our regular report analyzing trends in precious metals and rare coins. We monitor domestic and international markets and extrapolate from our 30 years in metals to place current events into a hard asset perspective. View archives.

7/29/2004: Range-bound gold still bullish


Greeting from American Gold Exchange. In this issue brief of Gold Market Update:

Range-bound gold still bullish
Silver surges, platinum and palladium steady
Rare Coin Canards – how to protect yourself!
Blowout specials in gold and silver coins

Range-bound gold still bullish

Summertime and the living is easy. That’s how the old song goes, anyway. While July and August are typically rather quiet months for rare coins and precious metals, this year is proving a pleasant exception to that rule. With an unusually high level of July activity in the gold market, and demand for U.S. rare coins continuing as strongly as we’ve seen in many years, the current bull market is sailing right through the usual summer doldrums, setting the stage for a possible break-out this fall.

Gold is currently trading just under $390. In our last alert, issued when gold was in the low $390s, we advised you to buy aggressively under $395. Since then, gold reached as high as $405 before settling back down under $400. But market fundamentals have not changed and the prospects for gold remain extremely bullish. Weakness in the U.S. dollar, swelling inflation, record-high U.S. trade and budget deficits, lingering uncertainty about the economic recovery, and ongoing geopolitical instability — all of these factors point to a substantially higher gold price in the near future.

Our conservative expectation is that gold will reach $480 to $550 an ounce in the next 12 to 24 months, or 25% to 40% higher than today. Our regular customers know that we've accurately anticipated almost every step in gold's rise from under $300 to over $400 in the past 18 months. We see more gains ahead!

Below $400, in our opinion, gold is under-priced. Under $390, however, gold is a bargain that should not be missed. The current dip in the gold price presents an excellent, unexpected buying opportunity before the gold market heads into its period of highest seasonal demand, the last four months of the year. We again urge you to buy gold aggressively under $395!

Silver surges, platinum and palladium steady

In our last update, when silver was holding support above $5.52, we advised you to buy aggressively under $5.95. Since then, silver surged as high as $6.70 on July 19, before short-term profit-taking pulled it back down. Remember, silver hit $8.29 earlier this year, so the short-term potential for silver is quite high. At currents levels around $6.35, silver still looks like a decent buy to us.

Platinum and palladium, like gold, have been primarily range bound since our last update. After dropping hard from the $925 level of mid-April, platinum rebounded from a low of $765 in early May to as high as $840 in late May, and has subsequently settled in the $775 to $815 range. We remain skeptical about platinum’s ability to rise substantially from current levels and we recommend against it. Sell platinum above $800 if possible, but don’t hold out for $800 if you’re already in profits. We recommend trading platinum for gold or palladium (see below).

After reaching as high as $325 in April, palladium is trading now at the $220 level. At current prices, palladium is an excellent buy and remains, in our opinion, the precious metal most likely to double in price in the next twenty-four months! Buy palladium under $240 while the opportunity exists!

Rare Coin Canards – how to protect yourself!

The surge in precious metals prices since 2002 has brought along a new wave of rare coin buyers, novices venturing into the market for the first time. We think that’s great! Unfortunately, this new interest has also brought an increase in some unscrupulous tactics by dealers who are more interested in making a buck than in providing good value.

We’ve recently produced a special report identifying the four most basic “Rare Coin Canards,” false stories that some dealers use to ensnare unwitting new buyers. We call these unscrupulous marketing schemes “canards” because if they look like a duck, sound like a duck, and walk like a duck, then you should duck and cover! To learn how to protect yourself from these shady tactics and bad investments, we highly recommend you read our report, now posted to our website.

Blowout specials in gold and silver coins

And finally, we are offering several great summer “specials” on our popular Blowout Gold & Silver Coins page. We acquired these high-quality coins through special deals and trade-ins, so we’re passing them along to you at substantially discounted prices. The offerings will change weekly for the month of August, so here’s your heads-up notice about where to find great coins at discounted prices. Check ‘em out!

That’s it for now. We’ll keep you informed.

As always, thanks for your time!


Dana Samuelson, Owner and President
Dr. Bill Musgrave, Vice President


Metal Ask      Change
Gold $1,788.81           $1.05
Silver $18.26           $-0.15
Platinum $847.87           $6.17
Palladium $1,986.49           $2.65
In US Dollars