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Gold Stock Alert

Sheeple vs Slizzards
Bob Moriarty
September 20, 2002

The overall stock market looks as if it is going to test the July lows. Gold bugs often forget that during a waterfall type decline the sheeple tend to throw the baby out with the bath water. That's what happened at the end of July, it happened in 1987, and we believe there is an excellent chance it will occur shortly.

The signs of a major bottom in the stock market are beginning to appear. That represents both great risk and great opportunity. The chance of a major bottom between now and the third week of October is excellent.

We wouldn't be major sellers of gold stocks. The risk of missing a move higher is greater than the risk of making a major move down. But downside risk exists. What I would look for is a possible plunge in the gold stocks followed by an immediate move back to where we started.

I'll use as an example a stock I bought on the day of the bottom in May of 1970. It closed on one day at $15 - opened the next day at $12, plunged to $9 and closed at $13 - all in one trading day. Therefore, it would be a prudent and potentially lucrative move to put in buy orders on your favorite gold shares at 30-40% below current levels and hope for a plunge.

If you wait until the day of the move, you will miss it. The market maker slizzards would have scooped up all the cheap shares which they intend to sell to you at higher prices later in the day. Remember, many gold stocks suffer from a severe lack of liquidity. Make that lack of liquidity your friend and ally during a plunge. wants you to make money. Of all the major gold/silver information sites, only we offer constant updates. Our day as gold bugs is at hand and the risk/reward ratio of owning gold shares is about as favorable as I have ever seen.

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-Bob Moriarty
September 20, 2002

Nothing we write is intended to be anything more than our opinion about the merits of a stock. Before buying or selling any stock, the investor should do his own due diligence.

The number of mining companies is small and we are investors for our own benefit. At any one time we may own 25-30 different mining stocks. It follows that often we will own stocks which we have written about.

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