August 20, 2025

 

(IT’S A JAY POWELL WEEK – WILL INVESTORS GAIN ANY INSIGHT?)

 

August 20, 2025

 

Hello everyone

 

I’m writing this newsletter after five hours of driving to attend a funeral of someone I have known all my life.  I drove two and a half hours to get there, attended the funeral, which went for an hour, and then said hello to the family, and then drove two and a half hours to get home in the pouring rain.

So, it’s been quite a day.  It’s 6:00 pm my time, and I’m just starting to write this newsletter.

All eyes are on Jay Powell this week.  Investors are looking for hints of what he may do at the September meeting. 

Let’s not dwell too much on Powell – and what he might say or do.  We can talk about it or write about it until the cows come home – that’s still not going to help you.

Instead, let’s look at some opportunities that may be setting up in the market for the long term.

At this stage, I really like Caterpillar (CAT).  Look at the chart here.  It broke through resistance and has now come down to rest on support, which used to be resistance.  The (OBV) On Balance Volume, RSI, and MACD are all converging.  The chart is supportive of further movement to the upside.

 

 

Importantly, we need to consider (CAT) as like a ‘picks & shovels’ stock for AI.   There is already an appetite for the stock via its power gen/data center exposure.

Evercore has upgraded the stock to outperform and raised its price target to $476 per share from $373. 

 

GOLD DEMAND CONTINUES AND PRICE TARGETS KEEP RISING

One of the investment banks, UBS, has just raised its price target for gold next year.

By the end of June 2026, it expects gold to be sitting at around $3,700, up from its original target of $3,500.  And by the end of September, it sees the yellow metal at over $3,700.

Driving gold demand are various factors, including the growing deficit and central bank demand, among the most significant.  China, India, and Turkey have been major buyers, helping gold overtake the euro as the world’s second-biggest reserve asset next to the U.S. dollar last year.

Keep scaling into those metals’ stocks a little at a time.

 

 

Cheers

Jacquie