• Zach Scheidt writes today’s glittering Rude.
• We’ve liked gold for a while now; Zach shows you one way he trades gold.
• Owning gold is great. Trading gold using this strategy costs less and has a bigger upside.

Happy Monday!

I hope you and yours had a wonderful Easter weekend.

Pam, Micah, and I are driving back up to Piedmont from Tuscany now.

So my friend and colleague Zach Scheidt is taking over the Rude today.

And what a glittering job he does!

Zach lets you in on a strategy he uses to increase his family’s wealth by trading gold - not merely owning it.

I fully approve of this method as a short-term trading strategy to supplement your physical or long-term holdings. And remember, it costs less and has bigger upside.

If this piece whets your appetite, Zach will have more coming.

As St. Augustine once said, “Tolle Lege!”

Take up and read!

And I’ll see you tomorrow.

The Case for $3,000 Gold

The past few weeks have certainly been full of twists and turns in the financial markets… 

As you may already know, Credit Suisse was recently bought out (or more accurately rescued) by rival UBS Group, continuing the chaos of the banking crisis. 

The merger is eerily similar to how Bear Stearns was taken over by J.P.Morgan, or how Merrill Lynch was merged with Bank of America during the financial crisis of 2007-2008.

And in March, the Fed announced another round of interest rate hikes, this time by a quarter point, sending the markets into freefall. 

In the weeks leading up to the Fed announcement, it felt practically guaranteed that it would raise rates again. But it became much less certain in the aftermath of the banking crisis.

As you may have noticed, the stock market can swing wildly in one direction or another as soon as a major headline changes investor sentiment. 

But right now, I’ve got my eye on one area of the market that’s been moving in just one direction... up! 

Given what I see on the horizon, this could be just the start of a much bigger surge.

So today, I want to take the time to explain what’s happening and share an aggressive way you can profit from this next move higher.

Gold Is Still on Track to Hit $3,000 an Ounce

In the January 2023 issue of my dividend newsletter Lifetime Income Report, I predicted that gold would hit $3,000 an ounce by the end of the year. 

While 2023 has certainly been off to an unpredictable start, I still feel confident about my gold price forecast. Allow me to explain…

As I mentioned, the Federal Reserve raised interest rates again last month. But after March’s meeting, it looks like the Fed will start to pump the breaks on rate hikes going forward.

The Federal Open Market Committee indicated that there might only be one more rate hike this year. If that’s true, it would mean three rate hikes in total this year compared to last year’s seven. 

And several investors expect the Fed will even be forced to cut rates — possibly several times — by the end of the year.

It's hard to know exactly what the Fed will do. If Powell raises rates again, he risks pushing a fragile economy into a recession, especially in what has become a vulnerable banking system.

But if the Fed keeps interest rates steady or cuts rates too soon, we risk inflation rearing its ugly head. Given the billions of dollars promised to banks, extra liquidity in the system could make the situation even more dangerous than usual.

The price of gold has been surging based on new expectations that we’re nearing the end of this rate hike cycle. And it could be a perfect catalyst for gold to hit $3,000 an ounce (or even higher).

Low interest rates tend to pressure the value of the U.S. dollar. Basically, when international investors get less of a return on dollars, they're likely to pull their money and invest it elsewhere. 

All of that capital moving out of the dollar will naturally act as a tailwind for gold.

Meanwhile, if inflation comes back like when the Fed stopped hiking rates in the 1970s, investors would scramble to protect the value of their wealth. And gold is the best way to do this.

Bottom line: I expect gold to continue its sharp rise this year. So I want to make sure you're in position to profit. 

Owning Gold Versus Trading Gold

I always recommend owning some gold as part of any well-diversified portfolio. Gold is a great long-term investment to help protect the value of your savings over time. 

But I also recommend trading gold (or buying gold for a shorter period of time) during certain economic seasons. And this happens to be one of them!

When the banking crisis began,I wrote in my free newsletter Rich Retirement Letter that precious metals would surge. And that's exactly what’s happened!

Gold should continueto rally throughout the year, but it’ll almost certainly be a bumpy ride with plenty of ups and downs. 

That's because as new information comes out, traders will continue to adjust their positions to try to get ahead of the changes in our economy. So don't expect a straight line higher. 

You’ll want to add to your gold position on any pullback. And you might also consider taking some profits off the table when we get a surge like the one we had last week.

For my family's money, I've been buying in-the-money call option contracts on the SPDR Gold Trust (GLD). I like this approach because call option contracts let me book larger profits while committing less capital.

And when GLD trades higher, I can sell the call contracts I have for a profit and use a portion of that profit to buy new contracts with a higher strike price. 

This is a great way to lock in profits while still keeping my position in play. If you want to know more about this aggressive strategy, stay tuned! 

I’m working on a project behind the scenes with my team. Once we’re done putting on the finishing touches, I’ll have some exciting news to share with you.