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Top 5 Commodity Picks for This Year

By: Halston The gains to be made over the next several years in basic commodities is incalculable. You don't want to get left out of this upcoming market opportunity. We are now entering the next leg of potentially the biggest major bull market in the commodity markets in the last 30 years. Pretty much every market has made gains, settled back down a bit, and is now picking up momentum back to the upside. If history repeats itself, prices of almost every commodity will probably take off to new all-time highs over the next two to three years. Here are my picks for the best trades for 2007:

1 - Gold
Keep buying it. In my estimation, the effective "floor" in the gold market, at least for the next several years, is close to $550. After an initial bump to over the $600 an ounce mark, the gold market experienced a correction/consolidation phase, moving back approximately half the distance between $625 and $525. It is, at the time of this writing, back near the $630 level. Expect gold to take out its former all-time high, and move well beyond $1,000 an ounce. Between gold and silver, thus far gold has been the market leader, which is why I would recommend it over silver. I would be floored myself to see gold drop back below the $500 level anytime in the foreseeable future--but I would not be surprised in the least to see the price of gold over $2,000 an ounce within the next year and a half.

2 - Cotton
To date, cotton has been the lagger in the futures bull market. When it does gain pace with the rest of the market, I forecast that it will find its footing right away. Cotton prices are now bobbing around $0.50, even with China and India encouraging exports and because the South hasn't recuperated from Hurricane Katrina's wake. Given that, I predict that cotton prices will double in the next 24 months.

3 - Wheat
Of all the grain commodities, wheat has indicated its strength since the opening of this bull market. Even when USDA reports doomed soybean and corn prices, wheat continued to push ahead. For wheat, I have a long-term price target of $8-$10.

4 - Cocoa
Cocoa has been acting similar to the gold market--that is, it spent a number of years going not much of anywhere at all, and definitely not higher. Then, in the initial phase of the current bull market, it shot all the way up to the mid-20s in price. Since then, it has moved back down the to the $14-$15 level, and has recently shown signs of bottoming out and recovering. Expect cocoa, like nearly every other market, to shoot back up, setting new all-time highs during this second stretch of the bull market. If you missed the run-up the first time, don't get left out in the rain again. Buy cocoa.

5 - The CRB Index
Want to do things the easy way? Then just buy the CRB Index, and ride the wave of the whole market. This is the most forceful bull market in commodities in history. Just as you could have made a fortune in the 1980s and 1990s simply by buying the Dow Jones or S&P Index (rather than trying to pick individual stocks), you can take advantage of the total market momentum in commodity futures simply by buying the CRB Index, and avoid the trouble of trying to figure out which specific market is the best investment return at any given moment along the way. Individual markets will, of course, have their highs and lows, but overall market momentum should remain strongly tilted to the upside. It's a bull market, period.

The upcoming five years in the commodities markets will present a never-before-seen chance to make money. Don't wait: another chance like this one certainly doesn't present itself every day. Don't miss out on the opportunity to invest for a couple of years, take home huge gains, and then sit back with all of your needs and wants taken care of.

Article Source: http://www.lifeweightloss.com

Halston Adams is an ex-broker who had the opportunity to model top traders, helping him to multiply his own $8,000 account into over $56,000 in 3 years. Learn more about his trading approach at: Futures Secrets today.

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