 Gold Action
2004
Dr Clive
Roffey
Gold Action
January 5, 2004
Welcome to
2004.
In the world
of cockney humour there is a joke about a passenger on a bus
going to Aldgate, a district in east London. When the bus reaches
the end of its route the conductor starts shouting "Allgit,"
"Allgit." The passenger asks if this stop is Aldgate
to which the conductor replies " No! Allgit orf." That
sums up the change between 2003 and 2004. It is time to get off
all the 2003 runners and make a clean sweep of portfolios.
I wish you
all a festive and profitable New Year.
Last year was
a series of subtle contrasts. The early half wallowed in negative
territory. A bottom occurred in April and the rest of the year
was devoted to a sustained rally with some of the lesser sectors
performing excellently. But it was a year of steady movement.
I look for
2004 to be a diametrically opposite year of dramatic contrasts.
Usually the impetus of the previous year carries through to the
first quarter of the New Year. But in the current case I believe
one can draw a line through the trading of Jan 2nd and state
that this day marked the end of one cycle and the start of a
completely new and opposite phase with overtones of vicious movement.
At some stage
during 2004 I look for:
- The Dow to
drop 3000 points from its current 10 500 level. I am not interested
in the fairy tale of a presidential election year. There are
far greater negative forces in play than a once off election
.
- The gold price
to move about 30% to well above $500 with silver up 50% to touch
$9 but platinum only gaining 20% to hit my already published
target of $1000
.
- Silver to
be the top performing precious metal for the second year running
with platinum the laggard
.
- Precious metal
stocks to completely out perform global equities, especially
the Dow
.
- One of the
most dramatic economic moves should come from the oil price as
I look for at least $40 per barrel to be reached during the year
.
- I expect the
South African Rand to continue to weaken, and from being the
world's strongest currency in 2003, to become it's weakest. I
look for R8,50 to the dollar at some stage
.
- The dollar
to continue to weaken against the Euro to at least $1,35 with
$1,40 a distinct possibility
.
- One of the
most significant moves of the year should be the rand price of
gold. Currently it is trading at R88 000 per kilo. Even the most
marginal of all the major producing mines, Durban Deep, is making
a profit at that level. But my target of at least R120 000 per
kilo during the year will send the South African gold stocks
into orbit
.
- South African
gold stocks to out perform the North Americans with Drooy at
the forefront of the charge
.
- I have continuously
detailed that the South African gold shares MUST move back above
their peaks of April 2002 and this I expect to witness during
the year. Some of these gold stocks should appreciate well over
100%
.
- Interest rates
to rise during the year putting a dampener on equity growth and
confirming that inflation is locking in on global economies
.
- 2004 should
be a year of precious metal share dominance in global markets.
I look for
2004 to be a year of dramatic change and dynamic movement. Gold
and Silver stocks should be close to the top of the performance
list with resource stocks in close attendance. I expect to see
general and global equities lose considerable ground.
Dr. Clive
Roffey
Johannesburg
South Africa
January 5th 2004
email: info@utm.co.za
Dr. Roffey
is a top South African analyst and gold specialist.
He also produces
Gold Action, one of the leading newsletter analyses of the gold
market
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321gold Inc
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