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Gold To Reach $2,000 An Ounce?

From Forbes.com  

I recently checked in with Curtis Hesler, editor of Professional Timing Service, for his thoughts on gold, which is now trading above $1,400. Below is his take on the commodity and his recommendation on how to best play gold:

Gold has finally decided to back off, and there should be a bit more selling before this correction is over. Gold posted three highs at the $1,430 level during November and December last year, which were finally exceeded this spring. Normally, when triple highs are broken, prices will surge short term and then correct briefly before resuming the rally. This is the correction that is unfolding now. Once it is completed, I look for gold to advance to $1,800 later this year and to above $2,000 in 2012.

If you are selective, you can leverage the next rally phase in gold by buying financially strong gold mining companies with real-time production. The ideal miner will produce at a low cost per ounce and will possess significant reserves to exploit in the future. The leverage aspect comes from the fact that as the price of gold increases—since their cost of production is steady—the increase in the price of gold will fall to their bottom line.

Buy Goldcorp (GG). The company, in my opinion, is the very best gold miner on the planet. Goldcorp’s operations are in politically stable countries in the Americas, and its production costs are the lowest in the industry.

As an example of what it is bringing online, Goldcorp just announced that its recently acquired Cerro Negro project in the Santa Cruz province of Argentina will add 550,000 ounces to its overall production at an average cost of less than $200 per ounce. Furthermore, proven and probable gold reserves have doubled at this project. Overall earnings doubled for the company in the first quarter of 2011, and I see more of that to come down the road.

Use weakness and pick up a little Goldcorp. I think you will be very happy you did once we approach the year’s end. In the longer run, Goldcorp should be an easy double, if not more.