Chris Temple from The National Investor – Fri 11 Aug, 2017

Mixed inflation data and precious metal stock moves

Earlier this morning we saw updated consumer prices that pointed to low/negative inflation data for goods and higher inflation for services. Chris Temple and I discuss what this means for the overall Fed narrative in terms of rate hikes at the end of the year. We also look at the constrained moves in precious metal stocks considering gold is threatening to breakout.

Click here to visit Chris’s website.

Click download link to listen on this device: Download Show


Featuring:
Chris TempleCory Fleck
View related posts on: , , ,

Comments:
  1. On August 11, 2017 at 9:49 am,
    spanky says:

    You can’t deny the the striking similarities between AXU 2010-2012 and AXU 2016-2017 so far, pretty much everything is identical except the MACD, FWIW, just thought is was interesting.

    http://stockcharts.com/h-sc/ui?s=AXU&p=W&yr=9&mn=0&dy=0&id=p33010341736&a=539103337&listNum=1

    • On August 11, 2017 at 9:55 am,
      spanky says:

      If it were to play out the same as back then you would expect AXU to make a run up to the 50 WMA in the next few weeks and then roll over hard.

      Even if this is all just bearish fantasy talk, one would expect a fakeout either down to the 100 WMA or up to the 50 WMA, before reversing to throw as many bulls/bears off as possible. Ugh!

    • On August 11, 2017 at 10:35 am,
      Excelsior says:

      The 2010-2012 pattern in AXU was as topping pattern as the metals were turning over where the pattern for 2016-2017 looks like a bull pennant where metals have bottomed and are taking off.

      2010-2012 rounded top doesn’t look anything like 2016-2017 ‘s bull flag.

      • On August 11, 2017 at 10:36 am,
        Excelsior says:

        Alexco Reports Second Quarter 2017 Results
        Aug. 10, 2017 /CNW/ – Alexco Resource Corp. (NYSE:AXU, TSX:AXR)

        “Alexco’s Chairman and Chief Executive Officer Clynt Nauman said, “Alexco is fully engaged on site operations and a plan to move steadily forward in preparation for a final production decision at Keno Hill. More specifically, the Company is systematically ramping up on-site resources to execute and support phased underground exploration and development campaigns, initially at Bermingham and subsequently Flame & Moth. In addition we have completed approximately half of the 12,000 meter surface exploration program in the Bermingham vicinity and expect to have the program completed on schedule in late September. Advancement of the 600 meter underground decline and subsequent underground drill program at the Bermingham deposit will begin shortly, pending amendment approval of the Class IV permit.”

        http://www.newswire.ca/news-releases/alexco-reports-second-quarter-2017-results-639771063.html

        • On August 11, 2017 at 10:38 am,
          Excelsior says:

          With all those catalysts coming up from drilling to development to a Production decision, I find it hard to fathom it will look anything like 2012 or 2013, but rather Alexco is getting ready to break out in the second half of 2017 and big time in 2018.

        • On August 11, 2017 at 12:25 pm,
          brian says:

          I actually bought more AXU at this price (I have not purchased any since it was at $US 0.28). In my opinion, AXU is the best silver stock on the planet (based on the extremely high silver grades, resource expansion, near-term producer (@400 tpd), excellent, low-risk location in Yukon, Canada, and it’s environmental business.

          It is probably a mistake, but I decided to sell all of my silver producers, at profit, located in Mexico (ASM, USA, IPT, EXN), and used the profits to buy pure-Canada Silver and Gold explorers/developers (AXU, MMG, BBB, GTT (up 300%), ABN). I just think the risk/reward is better for Canada-based explorers. Also, I consider Mexico to NOT be a low-risk jurisdiction anymore. However, I may use SILJ as a trading option when Silver starts to take off again (maybe US$25 by summer, 2018?)

          I have also decided to only own one gold producer: Klondex @ $US 3.00. The stock seems to have finally finished selling off. It will have a P/E = 20 at $US1250 gold and $17 Silver price levels. The growth/resource expansion potential is excellent and their grades are some of highest in the world. Klondex should have a solid 3X factor to the percentage rise in gold price, going forward

          • On August 11, 2017 at 5:13 pm,
            Excelsior says:

            Brian – I always enjoy hearing your thoughts on the Silver and Gold miners, and agree that AXU is going to have one hell of a run over the next 12-18 months. Their drilling at Bermingham and Flame& Moth has been stellar, and now that they fixed things with Wheaton Precious metals on the stream, and have several deposits to feed their mill, their are set to jet…..

            As for Mexico, it is not without risk, but no jurisdiction is really “safe”. You are correct that on a global basis Canadian miners carry a premium, and often if one compares similar operations or deposits in Australia or West Africa to Canadian companies there is no way to explain the value/perception gaps other than CanadianBias. Your strategy makes sense to me, but I like peppering in the unloved jurisdictions for the upside surprises when analysts do finally start comparing this companies rationally again one day.

            Still…. I’ve been buying ASM, USA, IPT, EXN so I can’t imagine selling them before the metals have a chance to start the 2nd leg of the bull market. 😮

            MMG is smart as AXU’s neighbor, I love BBB and can’t wait to see their drill results in both Ontario and BC this year, adn yes GTT has been having a rip your face off rally. I don’t know much about ABN but see investors discussing them on ceo.ca.

            As for Klondex I bought back in early this week. I had some in early 2016 for the first run up in metals, but had sold out until this July. It seemed wise to pick some up before the GDXJ rebalancing was finished and after their sell down, but I ended up just swing trading it for a quick buck and redeploying. However, I have spent some time reviewing their strategy for 2017 and am impressed with their large capital investment back into their business for growth, and figured I’d take a punt on it now that its sold down some. I don’t expect it to be as high of flyer as some, but I consider it a steady and safe climber for the next 2 years.

            Cheers!

          • On August 11, 2017 at 5:14 pm,
            Excelsior says:

            their = they’re

          • On August 11, 2017 at 8:07 pm,
            Matthew says:

            It might be famous last words, but IPT seems to hold a unique relationship with community it operates in. Unlike Primero, Fortuna, and many others over the years, I can’t recall there ever being any strife with their workforce or the government.

            AXU is definitely going to be a very tough one to beat. It has all the the right stuff.

      • On August 11, 2017 at 10:55 am,
        spanky says:

        I pray that you are right, but even a bullish resolution doesn’t preclude at least a scary intra-week or even multiweek headfake.

        We’ll see. I’m numb at this point from my AG and EXK exposure, so I guess I am prepared for anything in the short run.

        • On August 11, 2017 at 12:09 pm,
          Matthew says:

          You are going to be much better than fine with those stocks. I have zero doubt about that.

          • On August 11, 2017 at 2:03 pm,
            Robert Moriarty says:

            Matthew:

            I’m afraid your reign as stock timer of the month is over and we may well need to get on our knees and invite Trader Bitch back. Your timing is nothing compared to his.

            On July 9, 2017 at 8:55 am,
            TraderBill says:
            opinions from the bottom feeders are worthless as opinions never drive the trends…..as my mentor use to say just because you think a bottom or top is in place as you trade your position Mr Market always determines the real trend….so what has driven golds trend?…what added to the declines recently 1) US rate hike 2) US 10 year continues its trend 3) BOJ shocked the market with its continued aggressive buying of 10 yr

          • On August 11, 2017 at 7:57 pm,
            Matthew says:

            😮 What can I say, you’re right, Robert. His confidence peaked with silver’s spike down to 14.34! (That happened on Friday, 7/7, his comment was on Sunday, 7/9).
            Funny how he ignores silver’s 56% move up following the rate hike in December, 2015.

  2. On August 11, 2017 at 11:13 am,
    spanky says:

    AXU 2 hour chart. This one is about the shortest term chart that I personally find useful in identifying sustainable trends. As long as the 50, 100, and 200 WMAs stay like this it is a very positive sign. Actually nothing has really changed on the AXU 2hr chart–it has been bullish since the 24th of July. EXK and AG have tainted my outlook bigtime.

    http://stockcharts.com/h-sc/ui?s=AXU&p=120&b=5&g=0&id=p52647149178&a=539118606&listNum=1

    • On August 11, 2017 at 2:01 pm,
      GH says:

      This 2 hour chart turned bullish the week of July 24, when the price successfully tested the 200 MA, and the 50 MA crossed up over the 200 MA.

    • On August 11, 2017 at 2:11 pm,
      GH says:

      FWIW, the way I think about shorter term charts is to try to spot reversals and get in early on trends in longer-term charts. ‘Shorter-term’ and ‘longer-term’ are relative, can be any time scale, depending on one’s approach. If I want to play the daily cycles, I find the 10 minute, 1 hour, and 2 hour charts useful. Of course, I also keep an eye on the charts of longer term than the cycles I am trying to play, because that provides essential context for interpreting the shorter term action.

  3. On August 11, 2017 at 11:21 am,
    spanky says:

    GDX 20 day EMA is going to imminently positively cross the 50, 100 and 200 day EMAs. The last time that happened was February 2016. FWIW.

    http://stockcharts.com/h-sc/ui?s=GDX&p=D&b=5&g=0&id=p46237447715&a=539120322&listNum=1

    • On August 11, 2017 at 12:12 pm,
      spanky says:

      Actually, I screwed this chart up. The 200 day is actually the simple MA, not the EMA. We are no where near getting a cross. oops.

  4. On August 11, 2017 at 12:14 pm,
    CFS says:

    Mr. Temple,
    I keep on looking at money printing such as TART and the QEs and try to see the difference between this and the money printing in the Weimar Republic. I know there is a time lag before inflation, but I also thought we are in a period of “quickening”.
    Of course this time much of the money has been siphoned off by crony capitalism and banking and simply blown bubbles in bonds and stocks, but do these not ultimately have to burst and stimulate high or hyperinflation?
    Has the Fed the capability of unwinding the balance sheet in an unstable economy, without bubble-bursting?

    • On August 11, 2017 at 1:16 pm,
      Temple says:

      Those bubbles ARE the hyperinflation. It’s already occurred. Next stop at some point is the next wave of deflation to blow off some of that steam before it all gets pumped back up.

      As for the Fed it does have some ability, but that is necessarily limited. They will stay on their game plan until the markets yell “BOO!” — And then they’ll stop.

  5. On August 11, 2017 at 12:14 pm,
    CFS says:

    oops TARP not TART.

  6. On August 11, 2017 at 12:16 pm,
    Matthew says:

    In its 30+ years, I doubt that XAU has ever had its exponential moving averages so tightly and bullishly bunched-up.

    Technically and fundamentally, the prospects for a very healthy gold/silver equities bull market has never been better.

    http://stockcharts.com/h-sc/ui?s=%24XAU&p=D&yr=1&mn=8&dy=0&id=p35237974910&a=538778787

  7. On August 11, 2017 at 9:56 pm,
    Excelsior says:

    Looks like Nevsun is in trouble. I had seen investors discussing he price falling, but now I see why……

    ______________________________________________________________________

    Nevsun reports Q2/2017 loss, writes-down Bisha, delays Timok study

    Aug 11, 2017

    http://www.miningfeeds.com/2017/08/11/nevsun-reports-q22017-loss-writes-down-bisha-delays-timok-study/

  8. On August 11, 2017 at 9:59 pm,
    Excelsior says:

    The Best and Worst Performing Sectors in 2017

    JEFF DESJARDINS on August 10, 2017

    THE WINNERS SO FAR

    1. Internet and Software
    Companies like Facebook and Alphabet continue to dominate online advertising, while Microsoft, Baidu, and JD.com also are outperforming. SaaS-focused companies like Salesforce, Oracle, Workday, and Adobe also are beating the market as a whole in 2017 so far.

    2. Resorts and Lodging
    Hotels, cruise lines, and casinos are performing impressively in 2017 so far, even with companies like Airbnb competing on the accommodation front. Wynn Resorts, for example, is up over 40% on the year so far.

    3. Aerospace and Defense
    With Trump in the White House and both houses of Congress being controlled by Republicans, it’s no surprise to see big aerospace companies like Boeing up over 50% YTD.

    4. Healthcare
    As the population continues to age, medical appliance and biotech subsectors have taken off in 2017.

    THE LOSERS SO FAR

    1. Real Estate (Retail)
    The “Retailpocalypse” has not been kind to REITs focused on commercial spaces.

    2. Auto Parts
    With EVs and autonomous vehicles approaching on the horizon, less auto parts will be needed per capita.

    3. Apparel Stores
    Changing consumer tastes and the transition to online/mobile shopping is making life tough for some companies, like Urban Outfitters, which is down more than -30% on the year.

    4. Independent Oil & Gas
    The recovery in oil prices that happened in 2016 has not continued into 2017, and this has hurt independent oil and gas producers that have higher average costs.

    http://www.visualcapitalist.com/best-worst-performing-sectors-2017/

  9. On August 11, 2017 at 10:10 pm,
    Excelsior says:

    @Goldfinger – “This will be a new high weekly close for 2017 for $gold”
    — from #index, about 10 hours ago

    @Goldfinger – “$GDX with a real deal close, interestingly its the first weekly close above its 50-week moving average since February. “

    • On August 11, 2017 at 10:11 pm,
      Excelsior says:

      Precious Metals Nearing Breakout

      JORDAN ROY-BYRNE CMT, MFTA – AUGUST 11, 2017

      https://thedailygold.com/precious-metals-nearing-breakout/

      • On August 11, 2017 at 10:18 pm,
        Excelsior says:

        Locked and Loaded as the War of Words Continues

        Gary Wagner – August 11, 2017 #VIDEO #TechnicalAnalysis #Charts #Gold #Dollar

        https://thegoldforecast.com/video/locked-and-loaded-war-words-continues

        • On August 11, 2017 at 10:21 pm,
          Excelsior says:

          From the Gary Wagner piece above:

          “As of 230 EDT, gold futures basis, the most active Decembers contract, is trading up $6.90 and currently fixed at $1297.00. After trading to an intra-week low of $1257, gold futures came within two dollars of that elusive $1300 per ounce in trading today. Much of today’s gains in gold prices were directly related to dollar weakness, while trading throughout the week was a combination of both buyers bidding up the precious yellow metal, as well as dollar weakness.”

          “Because it seems unlikely that there will be some sort of resolution and peaceful conclusion to the North Korean crisis this weekend, it seems highly likely that recent gains in gold and silver will continue throughout next week.” — Gary Wagner

  10. On August 11, 2017 at 10:15 pm,
    Excelsior says:

    Nice daily closes to wrap up the week:

    Gold
    1295.00 0.4% gain

    Silver
    17.11 0.3% gain

    Copper
    2.914 0.4% gain

  11. On August 11, 2017 at 11:36 pm,
    Excelsior says:

    Precious Metals Sector Review & Top Picks
    Moniology – 30Jul, 2017

    https://www.youtube.com/watch?v=s1hZdPK23ko

  12. On August 12, 2017 at 12:18 am,
    Ozibatla says:

    Yes Excelsior good action in gold and silver. Time to back it up again next week… Gold especially!

    • On August 12, 2017 at 8:39 am,
      Excelsior says:

      Thanks Ozibatla. I’ve been backing up a small fleet of tiny wagons, trucks and SUVs over July & August, so at this point I’m all backed up. 🙂