For gold it’s all about the US dollar
Gary kicks off today with comments on gold but a true focus on the US dollar. While the dollar has come back in the last couple hours if we move down and close at or around the lows for the day Gary thinks it could continue to drop and test the intraday low back on August 24th.
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Here is a US dollar chart for your reference.
Osisko Acquires Canadian Portfolio Of Precious Metal Royalties
Tuesday October 20, 2015 10:05
Kirkland Lake Gold: Results Expand Continuity Of South Mine Complex
Tuesday October 20, 2015
Silver Standard: Marigold Mine Hits 3 Million Ounces Of Gold During Lifetime
Tuesday October 20, 2015
True Gold Begins Mining At Karma Mine In Burkina Faso
Tuesday October 20, 2015
P.S. – I just posted 3 updated Silver composite charts at the bottom of the daily market wrap from yesterday under “Industry News” section. (30 different companies featured from the Major/Mids, Small producers, and more speculative near-term producers/explorers).
Chad,
Any new update with uranium sector? It is very quiet.
Hey Lawrence. Hope all is well man.
The Uranium market has been sideways to down since the pop earlier in the year, as the energy sector has taken it on the chin (mostly due to Oil’s slide). I truly believe after 7-8 years of following this sector, that uranium production (not exploration) is one of the sectors that I expect the biggest gains in for 2016/2017/2018.
Personally I have averaged down the last 3 months in the following stocks (US ticker symbols):
(URG) – Ur-Energy [insitu producer still profitable at todays spot prices & they have longer term contracts they are producing at higher prices]
(UUUU) – Energy Fuels [the largest US owned producer that has made a number of key acquisitions, including URZ – Uranerz most recently]
(UEC) – Uranium Energy Corp [large asset base, however very little mining…supposedly holding out for higher pricing, but faced with legal mire. Still this stock has all of that discounted and factored in now, yet few have factored in the upside when it takes off]
(URRE) – Uranium Resources Inc [older company with good management that has been around for decades, but is reinventing itself with many mines ready to go when prices rebound. They also just acquired the insitu mining company Anatolia Energy in Turkey and plans on supplying Europe as well as the US markets]
(DNN) – Denison Mines [another company that has stood the test of time for decades, does environmental reclamation, has mines on standby, and just acquired the number 1 exploration target in purchasing Fission Uranium]
(PALAF) Paladin – [Big mines, one is on care an maintenance and does business in Australia, Africa, and Canada. They had a financial mess, the price fell like a stone, they have now restructured, and have recently had a nice pop as investors realized it looks like they are finally turning the corner]
I also hold small positions in Bayswater Uranium, Laramide, UEX, Eros Resources, Strateco, and Mawson Resources. I plan on getting a nice position in Toro energy, and Kivalliq Energy when the markets signal they are ready to run again.
What I like about this market is actually the fundamental story, and that the moves in spot price in Uranium tend to be explosive and sudden. This is definitely a market you want to have a position in before it moves, and after time their is a nice pop, it leaves everyone scratching their heads on how fast it moves. The catalyst beyond the Japanese restarts will be once the new 2016/2017 supply contracts are negotiated in the $50s-$60s. Most of the existing producers like Cameco, Areva, Uranium One, Energy Fuels, and Ur-Energy have contracts as much higher prices than spot, and they are only producing enough to meet those obligations. Most of their contracts expire between now and 2018.
There is still plenty of time to build positions for the longer term 3-5 year bull I expect to start next year, but when pricing does finally start to move it will definitely surprise investors, because Uranium doesn’t behave like most commodities.
I’m way early to the party on this one and thought we had bottomed at the end of 2014 and first half of 2015, but was wrong. Uranium will have it’s day sooner or later just like PMs, soft commodities, and base metals. For now things have been rather dull and trending sideways. If something major happens I’ll drop you a line.
Cheers!
Thanks for this information. I have the Canadian companies in the list but I may go purchasing URG next.
Here’s a composite chart of some of the Uranium producers. Longer term the smaller producers will out perform on a percentage basis (like in PM miners or small oil producers); however, they also outperform on the downside falling further than the larger producers like Cameco or Areva. If you shorten or lengthen the time horizon by right-clicking on the 200 days button you can see how things changed over the long haul, and in the last 6 months, 3 months, 1 week, etc…
http://stockcharts.com/freecharts/perf.php?URG,UEC,UUUU,URRE,DNN,CCJ,ARVCF,PALAF,UEXCF,URA#
I will say, unfortunately this chart doesn’t go back far enough (It only goes back to the end of 2011 when the Fukushima crisis began). If you could go back to 2008 or even 2010, you’d see the smaller producers far outperform Cameco and Areva, but they are the 2 giants in the industry (like Goldcorp and Barrick).
Al…DITTO your comments about Gary. I for one appreciate his work and look forward to his daily comments!
+1 I always appreciate Gary’s insights. They often cause me to re-evaluate my own thesis (which has been in more alignment with Doc lately).
He made a few great points about the US dollar putting in a lower low in August, and the potential that gold may have put in it’s bottom. I’m actually in the camp that is expecting one last leg down in PMs still this year, but will admit discussions like this one from Gary have me taking pause to consider very seriously his outlook.
Agree on comments about Gary’s work. If markets truly have the capacity to catch most people on the sideline or in the wrong position, we couldn’t hope for a better scenario than the one Gary sees as possible.
Thanks Marc!
IS SDSAILOR ….MARC?
Gold pushing up in Hong Kong, and end of the day London, …which tells you there is some strength. Two good moves happened during the course of trading, outside NY.
I believe MARK, with his late afternoon comforting call is way ahead of the pack when making calls. I would like to hear from him more often…………………JMHO.
DOLLAR CYCLE, per Nenner is going down, against the EURO……
Yesterday I said that a reversal today wouldn’t surprise me and that I wouldn’t bet against this chart just yet:
http://schrts.co/FxSl8M
On Saturday I said surprises look like they will be to the upside but today’s upside surprise obviously still needs work.
Gold’s action is like a worm popping it’s head out after a rainstorm and seeing no robin.
I like that it popped up above the trend line and MA lately for sure.
In other news, I’m glad I bought a lot more TGM into the recent low. +45% 🙂
http://schrts.co/ZdU0iI
It is neat they finally started mining at the Karma mine. That news is posted up above for anyone interested.
Way to go Matthew on 45% gain. Nice!
MATTHEW IS THE CHART MAN………..NICE WORK……..YOU DESERVE IT………
Good point about Matthew, Frank
If GDXJ can close at its high for the day (22.52) or better, the rest of the week could be very good.
http://schrts.co/tG00ao
Jeez ! Could $21.50-ish been the low for this retracement? I thought so a couple days ago – I use the Keltner Channel (20,2,0.1) rather than Bollinger Bands, for my primary overlay. I noticed, recently, that the midpoint has been support for several of my stocks.
I like to use both the Keltner Channel and BBs together. Here’s a couple of Schiff forks:
http://schrts.co/LUEStl
The reversal at the KC’s 20 ema rather than the BB’s 20 ma is not surprising given the bullish structure of the market, imo.
Anyone who looked at that little fork before 11:31 should look again; it required an adjustment.
I meant 9:31 😐
Put a fork in it!!
I will when it’s done! 😉
Ha ha! Love the charts man. Thanks.
GDX BB-KC Buy:
http://schrts.co/6wf7oM
No way !
Wow. I’ve never seen anyone use KCs crossing BBs as an indicator. That’s the most interesting technical info I’ve seen all day. Neato.
{ brian turns BB overlay BACK ON again }
Guys, here’s the rest: The buy is triggered when the BB leaves the KC while price is above the 20 ma/ema. The sell is triggered when the BB leaves the KC while price is below the 20 ma/ema. It does not matter if the upper or lower BB leaves the KC first.
Very interesting. I’ve never seen this analysis before. Thanks for the heads up.
Here it is applied to Claude:
http://schrts.co/YmQNHj
It can be fine tuned and used in conjunction with other indicators or simply to add (or subtract) a little confidence.
Interesting reading Matthew,
Thanks.
***** I TOLD YOU GUYS YESTERDAY THAT GOLD WAS GOING TO BE ALRIGHT *****
It will make NEW HIGHS very soon……so relax……..and silver will follow!
see note above……..thanks
THANKS FRANK and yes my computer algo’s on my system are right, and have been 80-100% of the time…………..remember earlier this year, the only thing that capped my system was the massive over the top to control it manipulation!
I remember , that is why I called for you a few days ago……….best …..
GDXJ needs to breakout out of its 2015 downtrend. The bottom of the channel is a long way down.
http://schrts.co/sMQ3Wg
23.10 marks the top of the channel and break out price today.
Can’t see gold coming all the way back to test 1140-1150 if it gets to 1200+ on just a daily cycle low. That to me would look incredibly ugly on the weekly chart and would leave the weekly chart looking neutral at best.
****** I LIKE GARY AND YES HE IS RIGHT……the dollar will head down! ******
+1
Among many other bearish developments, the widely followed 200 day ma has failed to hold UUP and the 233 day ema is going to give way next.
http://schrts.co/qi2kmv
Anyone got a theory as to why the markets have stalled out?
FED forgot to plug in the printing press………….
The Dow is at its (significant) megaphone resistance and the 233 day ema.
Hope you can see a monthly chart:
http://schrts.co/IvZyqI
Daily:
http://schrts.co/0hm9SU
Professor Peacock did it with the candlestick in the conservatory…….CLUE…..It’s all fun and games until someone thinks they understand these markets…… 🙂
Many think that they do. Me, I just listen to all and then make up my own mind!
Good plan. After Gary, Chris, Rick, and Doc weigh in, I usually feel very well-informed. Cory is getting pretty good with the technical analysis as well.
Then we have all the smart people that comment on the blog each day and we have a panacea of great ideas to mull over. Good stuff!
****** I TOLD YOU gold and silver would move up shortly and it has……….and it will continue! ******
Is it possible we put in a DCL today in gold?
Nevermind, it looks like we made a lower low too today, so we would need to get a higher high tomorrow for a swing low.
I say no break-out on the markets unless we get QE.
I agree. Everyone has seen the chart tracking the $spx and the Fed’s balance sheet. That chart shows how much of a farce the stock market is and how this has just been one huge wealth transfer.
Agreed though, no increase in the Fed’s balance sheet, no new highs.
So the Fed is talking about raising rates which is tightening but somehow you guys think they will tighten and loosen at the same time. So many people talk about the next mythical QE but I have not yet heard even one person suggest what assets they might buy to make that happen. Car loans perhaps? How about student debt? Maybe municipal bonds?
Or should they mop up bank issued debt and bonds?
I am pretty sure if they chose correctly they could get the economy roaring back to life. Maybe even get the fires burning too hot. But as I recall they already Tapered and have no intention of further accomodative policy.
So what makes you think another QE is coming?
Never said they would QE. But if they don’t the stock market isn’t going anywhere and will likely drift down in a jerky fashion in line with the Fed’s balance sheet which naturally shrinks over time as bonds mature.
Sorry Spanky. I misunderstood you.
Gary, it’s strange that you said 88 as a possible USDX dollar target.
I just looked at stockcharts USDX chart and the point an d figure chart has 88.0 as its target!
Gary, it’s strange that you said 88 as a possible USDX dollar target.
I just looked at stockcharts USDX chart and the point an d figure chart has 88.0 as its target!
http://stockcharts.com/freecharts/gallery.html?s=$usd
Here is the chart.
http://blog.smartmoneytrackerpremium.com/2015/10/chart-of-the-day-169.html