Prepare for Stock Market Crash Season: Why You Should Consider Buying Put Options for Gold Stocks
As we approach the volatile months of September and October in the stock market, it’s crucial for heavily invested stock enthusiasts to consider purchasing put option insurance for their portfolios. I recommend allocating 2%-5% of your portfolio’s value for this purchase as a form of fire insurance for your gold stocks “house.”
While the short-term outlook for gold may be uncertain, the medium-term and long-term prospects are incredibly promising. Despite the challenges posed by inflation and tariff taxes imposed by Western politicians, there is hope on the horizon.
Savvy Chinese car makers establishing themselves in Mexico could potentially meet free trade treaty requirements, offering US consumers affordable cars. This move could lead to China becoming a dominant car maker, driving up the demand for gold.
Amid rising tensions in the mid-East, the bullish double bottom pattern is likely to overshadow the H&S bear continuation pattern, pushing the price of gold towards $90 once again. Additionally, as the Fed plans to cut rates further, it’s essential to focus on gold as a safe investment option.
For investors, the key is to prepare for a pause in rates once they reach the 5% zone, with a focus on gold thereafter. Gold prices have already surged by 30% from the point of this call, with further potential for growth in the future.
Looking ahead, there is a risk of stagflation-oriented recession looming, making it imperative for all investors to increase their gold holdings. The weekly gold chart indicates a potential rally to $2800-$3000, driven by factors such as the PCE inflation report.
In the case of silver, a breakout over $32 could lead to a surge towards $35 and potentially a new all-time high. Miners are also poised for a bullish run, with gold stocks ending a 40-year bear market and entering a new bull market cycle.
In the short term, the technical action for gold stocks is looking healthy, but a pause is expected ahead of the PCE report. Gamblers and serious buyers alike should prepare for buy-side action and be ready for a positive outcome post-report release.
Overall, the current market conditions present opportunities for strategic investors to capitalize on the potential growth in gold and silver prices. By staying informed and proactive, investors can navigate the market uncertainties and secure their financial futures.