Are we in for another leg up for gold?
We start off today we Doc and a focus on the gold market. With gold getting a buy today in the face of poor economic data and the Bank of Japan holding steady with their monetary policy we could be set up for another run in the PMs. What to watch is the close on the weekly chart for gold.
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I have not changed my viewpoint Bill……….Not one little bit.
Let me tell you something. At the bottom of gold and even during its initial rise there were people saying that gold is not going anywhere fast. At that time I had turned bullish and not the least of the reasons was because we were entering the seasonal strong time for PM’s.
But that did not stop others from asserting that when gold was low it was going even lower.
Now we are at the top and virtually every analyst I listen to or read is saying that this is the time to buy because it looks like the all-clear for metals to run much higher yet. And every one of them has a different technnical or fundamental reason. Some even have a conspiracy angle to prove their case is air tight.
But here is how it works Bill. You buy at the lows and you sell at the peaks.
That is how it always works. Nothing has changed about the markets in any way, shape or form and any trader worth his salt who has been at this for years (and survived) will assure you of the basics of market behavior.
Is this the absolute peak? Maybe not but its close enough for me because there are enough data points to tell me that following a parabolic run we will not get ANOTHER big run-up in price.
Low was back when gold traded for 1040….high is after it has risen over 220 dollars in a span of 60 days. All we are seeing now is a consolidation before a very predictable and typical retracement of a sharp rise.
So it sounds like your saying the massive short position is sitting comfortably? They aren’t worried? Won’t panic? As they have done at other times in the 15 year bull? I wouldn’t bet with them right now. They are cornered. The next few weeks could be interesting. And just for the record, I dont know what’ll happen. But I won’t be picking tops for a few years.
Are you talking about the Commercials?
If you understand that the huge short position has absolutely no meaning to the downside, outside of a psychological affect on some traders, but potentially a nuclear affect to the upside because all those positions WILL be covered, yes, I’m talking :-)…trends up for now until it turns.
Retail covers in a panic. Hedgies cover in a panic. You have to know what you are up against and the time frames the different capital sources are playing with.
So you think that commercials are cornered eh jerryck ?!!!? I would think twice before saying that.Like they say jerry it aint over till the fat lady sings.I am of the belief that this has been the mother of all bulltraps courtesy of wall street call writers.Maybe I am wrong maybe I am not.Time will tell.
Bird and Don,
No point in arguing it. My vantage point is from a very long term view. I’m holding for the long term. Too much technical analysis has been detrimental to traders this year in the metals. This is a powerful move IMO. It leaves short term traders in the dust. If you’re right, more power to you. The commercial traders are all too human. The same emotions as anyone. They have panicked in the past and will someday again.
All the best!
DC..the metals charts disagree with you and bird…miners are up on down days in stocks..miners are leading bullion as has been the case at the beginning of bull markets..too many positives to be negative on metals regardless of the number of bears or bulls…
If I could add one more view, it’s not the Bulls or bears who are going to determine where this goes, it’s the secular trend that sets direction. Bulls and bears will only react to it in one way or another. One’s bias will determine what side they’re on. Have a great day!
Gator, I agree, the miners are looking for any excuse to move up.
Cnbc just had an expert calling for 1400’s gold if it gets past the 1280 area. We are coming into the tough slow summer period soon.
Funny but its hard NOT to find an analyst calling for higher prices. No matter where you look they all parrot one another. It’s like there is one or two experts who set the tone and everyone else just falls in line lockstep and mouths the same damn ed words.
Don’t nobody think no more?
Considering the Neg interest rate and the cash floating around this planet looking for a spot. RE is ON FIRE in BC.
There is a ton of fire power for gold and markets have risen for years…Golds barely moved. Few even have their eyes on gold…..think 2011 everyone did and I mean my neighbors too…not now.
Best
Not long all those foolish analysts were calling for $20 oil and that is when I decided to pump everything into oil at the double bottom bounce from 26.
They are all sheeple birdman and they lack technical knowledge.They do not think out of the box.
Bird..did you ever consider that the analysts are looking at the same charts and not just parroting each other..the exceptions are KWN and Bill Holter who in my opinion fit in your category of parrots.
Yep Bird, I continue to think!
That makes sense, Paul. 1280 would put gold just above the falling 382 Fib fan resistance…
I just wrote you about the $1280 level yesterday amigo.
On April 27, 2016 at 9:47 pm,
Excelsior says:
“If the metals start back up with Gold heading for $1280 and Silver heading to $17.72 then Iโll add, and if gold breaks below $1220 or Silver gets back into the low $16s then Iโll add. Either way, Iโll be adding once we get a trend going and the upside or downside targets are in range….”
Anyone who vacations and has irons in the fire is always watching the fire! Seasonality is a misnomer anymore.
Funny Marty – and true. Smart phones made it possible to be on the beach and check just to make sure the fire isn’t getting out of hand. ๐
Vaca-trading…. It’s like day trading only with drinks and ocean breeze.
Marty. I BELIEVE YOU HAVE MADE A VALID POINT.
Thanks for your input Bird.
I prefer to wait out the bull market rather then trade…ie bought 2001 sold 2011.
A small gold move will move share big time…Better then the prior bull. Even if this IS a bear market rally Ill take it.
So I think the metal doesn’t need to go anywhere fast. These mines are getting the poop together and going to be meaner and leaner then before….
Its not really a big move in the metal…even.
I agree that the surviving miners with real projects have been getting their poop together, and are much leaner and meaner as it relates to cost controls, efficiency, and recovery percentages in their processing. As metal prices improve, their revenues, and more importantly, free cash flow should start to remind people that businesses make money.
Cheers!
Bi)y the E, I agree that many of the miners have gotten much smarter!
When the going gets tough, the tough get going.Many have thrown the towel at this stage and discarded the idea that gold is still in a bearish trend.The consolidation that started in mid march is coming to an end.Right now smart traders are watching like eagles.Very crucial the point that we are in birdman.I cannot emphasize enough how important it is.It is the make or break point.It is here were the winner between the bear and bull is going to be declared.Lot of tension in the air.
I am on the same camp, slv:gld ratio when RSI daily over 80’s readings are
followed by significant declines in miners in the past. now RSI ratio is 81.91
how would explain ??
James the lesser is back
Picked up a block of AG several weeks back at $6.99
Picked up another block at $10.12
I am doing well.
Went to buy NUGT in the mid fifties and couldn’t because my brokerage firm doesn’t handle that stock. Meanwhile my friend got in, who knows nothing about gold.
Anyway I like the upward price pressure on both metals.
Good to see you back James!
Welcome back James the Lesser.
This present rounded bottom looks almost exactly like the first (a bit shorter). To me it’s discounting something. Up until now, so much for the commercials. If they start covering, look out!
http://stockcharts.com/h-sc/ui?s=Gld
On the other hand it could be thevlarges speculators that start to cover their long positions ๐
I meant the large speculators not thevlarges speculators
Both bulls and bears can make a case on the PM charts. But when gold hits 1280, the roadrunner might slap a hole in the road. Too many bulls ready fall in that hole..
Nice analogy chartster ๐ I view it like when the coyote runs over the edge of the cliff.At first he does not realize what hit him and when he does it is too late and down he goes.
Funny. The coyote also likes clinging to rocks (even if they are falling). ๐
Ha ha, yes. Then the roadrunner hands him an anchor, just to insure the sound of the thud.
So we’ll just have to wait and see because I agree that the $1280 level in gold is key and had mentioned that a few times recently. It will either be a roadrunner hole (trap door) or it will be an Acme rocket launcher (made in China).
We’ll see how it goes………
Road Runner & Wile E. Coyote – Rocket
The lesson in that clip is to watch out for overhead resistance…..
So far the move beyond $1280 has been more on the rocket side than the roadrunner hole, so it like the rally will continue on…..
STAGflation I think is accurate. The working class will get poorer and the owners of Property ect will do well
I don’t have a clue what is going on. Am I allowed to say that?
I said those exact same words at my second wedding, Bob!
๐
Interesting comments from Doc about how this gold rally seems enormous but it probably is nothing compared to where it is going longer term.
Very diplomatic ๐
Bob UK, remember virtually every PM issue was down 70-99% in Dec-Jan from their 4-5 year highs and yet most are still down 40-90%.
A solid point. It was easiest for the big returns right out of the gate in these miners because of how low they had sank and how beaten up the sector was. The next 200-500% returns will be a bit more challenging.
LOL good one Bird…
Ha! Its a true story except there was more cussing.
Was it you doing the cusssing, or was it your wife and her family? ๐
That would be me….but nobody knew what I was saying! ๐
funny.
Bird..your first words should have been “what am I doing here”. a little humor nothing else..
Actually I did say that Gator. And few other things too. My Mother in law and her daughters cannot speak more than a few words of English. Only my wife studied it. She is fluent. I still have no idea what the priest said or what they made me promise but there was a lot of chanting and banging on drums. It was quite the day!
Lol, great story !
Funny slice-of-life story Birdman. It couldn’t be that bad if there was chanting and banging on drums. Sound like quite the shindig.
I was ill prepared for an African wedding, Shad but it was the best decision I ever made. My wife is fantastic and I can finally speak with some fluency to her family. Feminism never quite made it to this part of the world. There are no Social Justice Warriors here. No stupid pretenses.
So men and women don’t have to fight all that baggage. Instead they enjoy more traditional relationships that have been the norm since time began. Not that its all perfect or anything but its a whole lot better than the life than I had with my first wife.
Well I am happy for you man. I’m very grateful and joyful with my lady, but I agree that the gender programming and friction here in the US is a bit ridiculous and creates social tensions. It would be refreshing for an environment without all the BS.
Cheers, chanting, and drumming!
I have to say that at my second weddong, I new exactly what I was doing. I was simply “following the leader”. Good thing that I did!
Very wise Big Al. Congrats!
I am sorry to have to disagree with almost all of the interview on gold. This is the point where greed has kicked in for traders who are high on recent gains and no longer able to be rational or objective about this market.
To my eye, all that is happening now is that the price action is enticing in the stragglers who missed most of the ride. The long period of consolidation we are seeing is creating the conditions for those retail buyers unfamiliar with gold behavior to get invested before it declines.
This is so classic it actually makes me laugh out loud. I won’t say that gold cannot go a little higher yet but I am certain the decline is going to be pretty painful and cost a lot of those newcomers a lot of cash.
Anyone chasing this is nuts in my opinion.
not my quote but a good one I once heard: it’s fine to have opinions, just don’t be attached to them.
I am attached to technicals and ewa jerry and so far they have not turned bullish.I have been saying all along that this is wave iv of an expanding diagonal triangle.I base my opinions on solid foundations not on fundamentals or any other paid shill analyst.Those that say that gold has turned bullish are wishful thinkers and dillusional to say the least.There is no confirmation yet.
That is so very true, J!
I am nuts. Been flipping NUGT since $23 this year. ๐ I love playing with dynamite.
Yes you are nuts be we like you anyway ETF ninja. ๐ฎ
We have a job for but you will have to travel to the mid east.
Ha! Jason would take it. He buys and sells machine guns for fun. I enjoy his gusto.
Pretium continues hitting Bonanza grade strikes 30+ oz/ton in 5 infill holes.,simple the creme de la creme gold deposit in the Americas that is untapped and in production in 2017.
Anyone get knocked out on the stop run on NUGT yesterday? The manipulation that AVI says does not exist. Lol! NUGT hit $100 today. I am sidelined until Monday. Still riding a losing hand in DUST.
Try NUGT on margin to get a real high and make sure you drink Red Bull to stay alert.
But jump on a trampoline for 5 minutes before drinking the red bull and then buy NUGT on margin. Then rappel out of the office building you are in get in you car, do about 120 mph on the way home, and call it a day….
DUST looks like it is headed to zero. It is either a great buy here or falls further but the downside is now limited.
It is getting a 1 for 10 reverse split in the second week of May, Paul. Same with JDST. Its not dead though as the counterparts NUGT and JNUG are very much alive and being heavily traded each day. Had you been holding those when miners took off in January and were not paying attention, your account got murdered.
“Itโs like there is one or two experts who set the tone and everyone else just falls in line lockstep and mouths the same damn ed words.”
There’s some truth in that. Not just the technicians falling into step. Pundits on the mining sector, too. The difference is that the technicians come across as deadly rivals but the sector newsletter writers seem to be rather inter-dependent.
During the gold run a few years ago there was a pundit on our side of the Pond. As far as I can tell, he didn’t have a single original thought in his head but he fancied himself an opinion leader. When gold was on a run and most people thought it would go on forever, so did he. After the bust and when most people – rather late – came to hate gold, so did he. It came about that it was useful to read him just to get an idea the way the wind was blowing. He was an indicator, a weather vane. Already it’s clear in this run that some pundits can be read the same way.
Herbert, I’ve been an aggressive PM investor/ spec since 1999. Please name that guy on this side of the pond. I hope Richard Russell is not on your mind
It ha always been that way Herbert!
That’s true Al. We all find out in the end and sometimes we learn it the hard way. There seems to be just a precious rare few gurus who have consistent insights into markets and then there are a whole lot of copy-cats making a buck off the work of those guys. Too many of the mouthpieces are brilliant at self promotion, communication and packaging the ideas of other people but are not so good at getting you in and out of trades when you really need them.
You have got to think for yourself.
Birdman, great to hear from you…hope all is well!
Going good James. I was pretty sick for a few months but finally got back in the saddle and started posting here again. Looks like I am getting my ass kicked by silver judging by the close today. Ouch!!
can’t agree doc with your recent gold bull call. How come no more talk of the commercial shorts indicator from a month ago which apparently predicted a gold decline. Are they all suddenly not correct in spite of being touted as a key indicator when they are net short. I guess they’re that smart afterall. Well for me gold is still meandering below 1300. Miners as well, after the initial surge into early march. Oil was also not to be believe and look now. Bears have all but vanished in the commodities and it’s a time to be cautious not looking breakouts. If commodities are to do what you speculate the convential markets should also soar and it ain’t going to happen.
Harry, I really haven’t made a gold bull call for a second leg—only have said that if we close at a higher weekly price for a couple of weeks, the odds move to that possibiity. It’s not baked into the cake yet.
Who will be wrong this time; the large specs whose their long pos is at record highs or the commercials whose their net shorts is at record highs ?!!?? Who is going to hedge his positions or cover his shorts?? who?It is a leap in the dark to say who but if I had to choose one at gunpoint I will choose the commercials ๐
Maybe it will be a Mexican standoff all the way back to 1920 gold.
Naaaah.
At present and since the end of January, it appears the USDJPY is superseding the Commercial COT in which way the metals go.
Looks that way. The dollar broke down from my target low, the Yen broke up.
But that’s not the whole story and this recent action is just two trading days. The market still wants to inflict the maximum pain on the largest number of people. I remain undeterred in my views that metals and miners are peaking on an interim basis and feel May is going to bring a turning point and plenty of action.
I can finally get a respectable wave count that looks reliable on gold’s little brother. Silver has gone vertical and that is quite encouraging as it will bring an end to the parabolic run. Depending on the action Friday I may again be adding to short positions to bring my cost basis as low as possible.
Meanwhile, gold itself has still not broken out of its falling bearish trend channel. Same story for the big daddy of gold mine indexes, the HUI. After all the noise and fury and despite a fantastic few months of price climbs they continue to remain trapped below technical resistance and are now ripened for a correction.
That is what I am most interested in watching. So they are still in a bear market. I have no idea what will set off the decline but there is always something. This weekend may just bring that resolution with some sort of news.
Worst case scenario will require position hedges, not a change of philosophy. But none of this is haphazard. It is deliberate and calculated on my part. I did not catch the last move up in either the gold or silver miners nor will I get the exact bottom on the short trades.
No big deal, I should do just fine even if I am underwater for a spell.
By “last move” incidentally I am talking about all the action since I first initiated shorts. I was too early as usual. It’s a damned curse at my house. The guys who can accurately time a reversal are genius in my books.
I think the specs are feeling good and won’t sell just yet. The commercials in recent weeks are adding to protect their existing position, not because they ‘know’ it will go down. Some of their shorts are very deep in the red and getting deeper and their risk is higher do to added positions. IMO they are not acting from strength, but from weakness. They can’t keep adding. I expect another intervention soon since 1280 is almost here. All interventions have failed in recent weeks. This is very interesting.
Naah ….too good to be true ๐
I forgot to post this update on Nicola Mining. They’re going to have an additional profit stream from milling other mines ore soon, and they can also do soil reclamation work on mining waste with heavy metals and chemicals as even another revenue generator. There has also been talk that they may also be going back into Silver & base metals production soon. Just a heads up for anyone following their progress. I believe they are going to be one of the better “turn around” stories in the Silver space, along with Alexco and Aurcana.
_______________________________________________________________________
Nicola Mining Inc. Receives Permit Amendment Approval for Custom Milling
by nicola_admin | Apr 18, 2016 | News Releases |
“Nicola Mining Inc. is pleased to announce that it has received an amendment to its M-68 Mine Permit. The amendment allows the Company to enter into third party custom milling contracts and enables it to mill up to 200 tonnes per day at its wholly-owned Craigmont Mine site, located 10 kilometers from Merritt, British Columbia.”
“Nicola expects to start receiving material from Siwash Minerals Inc. (the โMinerโ) in early May and plans to commence milling upon receipt of 1000 tonnes…..”
“Given the complexities and costs of attaining a mill site in British Columbia the Company is positioning itself as a โmilling hubโ for high-grade gold properties located in the province…..”
http://nicolamining.com/nicola-mining-inc-receives-permit-amendment-approval-for-custom-milling/
The Silver turn around team of near-term producers (that already have their mines and mills built and are are waiting for higher prices) did pretty good today:
Nicola Mining Inc. (HUSIF)
0.0897 Up 0.0097(12.13%) 12:06PM EDT
Aurcana Corporation (AUNFF)
0.2848 Up 0.0206(7.80%) 2:34PM EDT
Alexco Resource Corporation (AXU)
1.1850 Up 0.0650(5.80%) 4:00PM EDT
EX, you’re the BEST!
Hi Marty – Congrats on the Silvercrest Metals@ 750% gain! I owned it and sold on the news of the First Majestic takeover, but then did buy the spin out company Silvercrest Metals, but sold it to buy other Silver stocks. It has definitely been one of the top performers since the January lows, and I’m kicking myself for selling it, but I did pretty good with a few 200-500% returns.
BTW that is very encouraging to hear about the prior 30 bagger with Minefinders and the 72 bagger with Aurelian. I just now got around to reading the bottom of yesterday’s market wrap.
Let’s do it again on this bull run over the next few years!
GPL is a huge performer.
One of my old favourites. It has come late to the party.
Absolutely, but Great Panther is also already in production. I still have small positions in Americas Silver, Silvercorp, Great Panther, and Avino Silver and Gold, (and wish I’d have taken out a position in Impact Silver).
My point on the companies above was that they have mines on care and maintenance and their share prices will launch when they go back into production. Also Alexo has the environment cleanup division that brings in revenue, and Nicola Mining has the contaminated soil reclamation option, and the tolling agreement at their mill to process other mines ore. This is a big boon to Nicola because they’ll be able to generate cash flow starting next month processing ore, and I doubt most even realize that they are the old Huldra Silver with a fully built mine and mill.
Just trying to give KER folks a heads up on some companies that may jump suddenly if they announce they are going back into production with the rising metals prices.
Thanks Doc!
I wanted to check in on with Birdmans inside reversal? I wasn’t buy that with all do respect.
I had bought BACK the very few I sold last week.
I had mentioned the dynamics of this market is different. The rally were not to be sold.
Mathew and I were correct.
Loonie moving higher and Utilities as well ( Good indicator)
Bulls hate riders and lots have sold this rally..
Breakout!
http://stockcharts.com/h-sc/ui?s=ZJG.TO&p=D&yr=2&mn=0&dy=0&id=p14918373464&a=426624018&listNum=1