Gold, Silver, Coal and Metal Mining Rallies on Weak US Dollar

On Monday energy prices rallied on the weaker US Dollar and some help from lower temperatures in the states, and the gold, silver, coal and metal mining rally continued. The weak dollar has led investors to pour money into commodities that are traded in the US Dollar including oil and natural gas over the past couple of months. 2009 has been a good year for commodities with Continuous Commodity Index (GCC) moving from $21.49 to a recent 3 month high of $24.54.

Gold and Silver

In the gold space the Spiders Gold Shares (GLD) is the safest and least volatile way to speculate in the trend continuing higher in commodity prices and gold in particular. The Exchange Traded Fund reach a new 52-week high of $103.64 just days ago. Some are warning of a bubble in commodities which is true but as long as the dollar continues to weaken, the chance of  a major change in direction is unlikely. The signs of economic improvement in America and in other major economies around the world boast well for commodities as supply will increase as countries begin to build new infrastructure again.

Coal & Metal Mining

Coal and Metal Mining is seeing similar interest from investors but taking a look at individual shares within the industry does not present a decent investment. BHP Billiton Ltd (BHP) is the largest company in the area which has some decent growth 54.5% earnings with –10.6% revenue for the year but is in the midst of a fairly tough quarter so could have topped out at a recent three month high. This is fairly representative of many of the stocks in the industry.