In the January 25 report titled "The return of commodities", I indicated that gold is the leader among the commodity groups and that the target for this metal was $925 in February. As gold has already reached this first target earlier than expected, the new target has been raised to $980. Models continue to suggest that the US Dollar Index will see lower price levels in February and March. This action should move gold upward toward its new higher target. Equally as important to note is that gold leads the other commodity groups. Agriculture, oil and base metal are anticipated to follow gold's lead in the months to come.

Investment approach: Precious metal ETFs offer an effective vehicle to participate in the expected move in gold. Here are several to consider:
1) XGD (CDN)
2) IGT (CDN)
3 HGU (CDN)
4) GLD (USD)
5) DBP (USD)
6) IAU (USD)
7) GDX (USD

More information about commodities can be found in the upcoming February newsletter. Go to www.technicalspeculator.com and click on member login.

Your comments are always welcomed.

By Donald W. Dony, FCSI, MFTA
www.technicalspeculator.com

COPYRIGHT © 2009 Donald W. Dony
Donald W. Dony, FCSI, MFTA has been in the investment profession for over 20 years, first as a stock broker in the mid 1980's and then as the principal of D. W. Dony and Associates Inc., a financial consulting firm to present. He is the editor and publisher of the Technical Speculator, a monthly international investment newsletter, which specializes in major world equity markets, currencies, bonds and interest rates as well as the precious metals markets.

Donald is also an instructor for the Canadian Securities Institute (CSI). He is often called upon to design technical analysis training programs and to provide teaching to industry professionals on technical analysis at many of Canada's leading brokerage firms. He is a respected specialist in the area of intermarket and cycle analysis and a frequent speaker at investment conferences.

Mr. Dony is a member of the Canadian Society of Technical Analysts (CSTA) and the International Federation of Technical Analysts (IFTA).

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