4 charts to balance this gold breakout
Chris Kimble, Founder of Kimble Charting Solutions shares the charts below that balance out all the optimism around the gold breakout from last week. As he points out there are some correlated markets that are flashing warnings signs about the short term sustainability of this rally.
The larger miners have definitely got a bid the last few weeks, and held onto most of the gains. I see retail investors on many sites scratching their heads on why their precious early stage discovery play hasn’t rocketed higher on the rising metals prices, and they just don’t get how these cycles work.
The new money from institutional firms and generalist investors will usually land in mining ETFs (mostly composed of the larger market cap and more liquid Majors and larger Mid-tiers, along with the Royalty & Streaming companies). After those start to move and gain, then money starts moving downstream to Jrs – smaller producers, development stage companies, and exploration drill plays.
The fact that miners did outperform the metals was bullish, but I’d like to see a larger ratio (3.5:1) and more action in Silver prices just like everyone else.
It’s also amusing how impatient so many investors get. Gold makes a move over a few weeks, and immediately investors are ready to throw the baby (Silver & Jrs) out with the bathwater (first retracement) without giving them reasonable time (multiple weeks or even a month or 2 to get on the move).
There has also been a series of articles, blog posts on many sites, and audio commentaries where people are consistently belly-aching about Silver’s not doing much.
Despite the fact that Silver prices haven’t gone up nearly as much as Gold’s price has, most of the Silver Producers got a bid recently, and several gapped higher on strong volume. That’s pretty bullish IMO>
> 2 month Candleglance #Chart of #Silver #Producers:
$AG $PAAS $CDE $HOC.L $FSM $USAS $SVM $EXK $ASM $EXN.TO $SCZ.V $IPT.V
Jordan Roy-Byrne – We are in a Gold Bull Market that may well last 20 Years
by @PalisadeRadio on 27 Jun 2019
Holger Zschaepitz @Schuldensuehner
“In case you missed it. Value of global bonds has hit fresh highs, fuelled by dovish CentralBanks.”
https://twitter.com/Schuldensuehner/status/1144276255447146498
Gold miners acting strangely. One half of my picks goes up as the other half goes down, the following day they reverse, with the winners now the loses and the loses now the winners. I surmise that everyone is just guessing at the moment
There is also a lot of selling from prior trapped longs, as their stocks finally rose, and accumulation from new investors getting positioned, so there is a lot of market churning where a run up is sold off, and then when it pulls back, purchased by new stakeholders.
It’s good to see more volume and more activity in the space.
Personally I’m looking forward to a solid Weekly, Monthly, Quarterly close tomorrow in #Gold to confirm the next leg of the bull has been set in motion, but there will be fits and starts along the journey.
The bull likes to shake the most riders off it’s back on the ride up the wall of worry as possible. Cheers!
Nigel:
I also see the alternating miner stocks. I can only assume the apparent orchestrated treatment of miners comes from the algos of the banks and hedge funds. The implication of such manipulation without regulation is a conspiracy of special interests and the government. This is given strength by the total lack of criminal prosecution of any humans involved in the process that only pursues civil actions against entities. These civil actions only result in funds passing between private organizations and government agencies. The victims of the corruption receive nothing and the perpetrators (human) pay nothing. All costs passed to third parties such as market investors and stockholders of companies.
Has Tether Been Fueling The Bitcoin Bull-Run?
Authored by Ben Munster via Decrypt.co – 06/27/2019
https://www.zerohedge.com/news/2019-06-27/has-tether-been-fueling-bitcoin-bull-run
Trump Weighs Limits on Uranium Imports After Commerce Cites Security Risk
By Ari Natter and Jenny Leonard – June 20, 2019
“The U.S. Commerce Department has recommended the White House take steps to protect the domestic production of uranium after finding the nation’s reliance on imports was a national security risk, said three people briefed on the matter.”
“Among the trade remedies recommended is to require nuclear power plants to purchase a minimum of 5% of the radioactive fuel from U.S. mines..”
“A decision to impose the quotas would be a boon to the two small mining companies that petitioned the Commerce Department to take action, Energy Fuels Inc. and Ur-Energy Inc.”
(URG) Ur-Energy has been one of my best performing Uranium stocks the last few years, out of the 2016 bottom in Uranium spot pricing surging into the 2017 Q1 Run, where I advised trimming into the frenzy, and then adding more on pullbacks in later 2017 and 2018 and holding into the current environment to new highs.
If the Petition 232 quots for US Uranium miners gets more teeth, then this highly torqued company can really move.
So far it was already an easy double 2 times, but I’d expect from here it could go parabolic and become a real multi-bagger.
quots = quotas 🙂
Bring it!
US #Uranium miners see boost from Commerce Department report
Reuters
“The White House is currently reviewing a petition lodged by the companies, $URG $URE Ur-Energy and $UUUU $EFR Energy Fuels, that asks the president to require that at least a quarter of U.S. uranium needs are filled by domestic supply, and requiring U.S. federal power utilities and agencies to buy U.S. uranium.”
http://www.mining.com/web/us-uranium-miners-see-boost-commerce-department-report/
India scrambles to look overseas for Rare Earths used in EVs
State-owned companies aim at China-free supply as trade war concerns mount
ROSEMARY MARANDI and KIRAN SHARMA – JUNE 27, 2019
Wow! I’ve own a small position in RNX, but now I wish I had purchased more.
(RNX) (RNKLF) RNC Minerals Announces 390% Increase in Measured and Indicated Gold Mineral Resource for the Western Flanks Zone at Beta Hunt to 710 koz
@newswire on 27 Jun 2019
5-fold increase in Measured & Indicated resource to 710 koz
3-fold increase in Inferred resource to 250 koz
Western Flanks structure remains open to the north and at depth with good grade and thicknesses of mineralization at the margins of the resource including the deepest and northernmost hole from the current campaign (WFN-083) that yielded 6.3 g/t over 13.9 metres (estimated true width)
https://ceo.ca/@newswire/rnc-minerals-announces-390-increase-in-measured-and
by @newswire on 27 Jun 2019
GDM (Gold Miners Index) is holding up very impressively considering its overbought RSI reading of almost 90 on Monday. So far, it has managed to stay above steeply rising Fibonacci fan support:
https://stockcharts.com/h-sc/ui?s=%24GDM&p=D&yr=1&mn=2&dy=0&id=p78372352557&a=577064562