Commodities have been extremely volatile, and most of them went through a recovery period out of the Corona crash lows. The only exception has been gold and silver. No surprise, as we identified the start of the new gold bull market back in the summer of 2019. Our new gold forecast is bullish for 2021, but gold is not our top commodity for 2021, nor is silver our top pick as per our silver forecast 2021. As per our most recent commodities outlook we predict that the following 3 sectors will provide huge opportunities in 2021, however timing will be crucial for success: platinum, lithium (similarly, also cobalt), pot stocks (considering this to be a commodity). Our commodities outlook is another great piece in our series of 2021 market forecasts.
Platinum looks really good here as we enter 2021.
As said in our piece Which Precious Metal To Buy In 2021 we consider platinum our top precious metal pick for 2021. This is what we wrote:
Platinum is on the rise, and it is trying to break above 4 year highs now. This is attempt #4 to break out to a new bull market. We believe it is a matter of time until platinum breaks out. And presumably early 2021 we will see the breakout confirmation. This chart clearly suggests that the upside potential in platinum in 2021 is some 40 to 50%. We would not be surprised to see platinum peak around 1500 USD / oz ‘somewhere‘ in 2021.
The way to invest in the platinum trend is the next one that comes up. And we would warrant investors to be cautious. Many ETFs cover much more than just platinum. There are ETFs covering the platinum and palladium price, and we are not as bullish on palladium as we are on platinum.
There are not a lot of pure play platinum miners. But the ones that are out there, with good financials and a strong correlation with the platinum price, are the ones we desire to buy and hold in 2021.
Yes, in our Momentum Investing portfolio we already identified our top pick. And it’s a matter of time until we flash a buy alert on this top platinum miner. Upside potential: 2x to 3x in 2021.
The 2nd sector we like a lot is Lithium. Likewise, cobalt, but we call out lithium in the first place because cobalt is a tiny market. Both are correlated, most of the times.
The lithium tech ETF looks really solid here, and we believe this will offer many opportunities in 2021.
The lithium LIT ETF broke out to all time highs. Buy on the pullback is what we would suggest.
The 3d sector is pot stocks.
Yes, we consider it a commodity. And it looks like this setup is gorgeous for 2021, with multi-fold upside potential. We recently took a position in what we consider a top pot stock, good financials (very healthy company) and an amazing breakout in play currently (at the time of writing).
The sector ETF MJ has a gorgeous setup, it’s a breakout play and the upside is at least 2x.
Note that these 3 commodities are really a select few out of a long list of commodities to invest in. And, yes, it might make sense to invest in the commodities ETFs to avoid the hard work related to stock investing as not all commodities have stocks that are centered around only one commodity.
Enjoying our work? We invest in broad stocks as wel as commodities in our Momentum Investing portfolio. Also our Trade Alerts premium service has affinity with commodities as we take a gold or silver price trade from time to time. In 2020 the combined portfolio delivered +100% (one month before 2021 kicks off). We are on track to double our capital annually, as per our Mission 2026.