David Erfle - Gold Market Commentary – Tue 19 Nov, 2019

As Silver Stocks Continue To Lead Will Gold and Silver Follow Higher?

While gold and silver have bounced off support they are not screaming higher and drawing a lot of attention. However if we look at silver stocks, both large and small, plus the large gold stocks they are telling a very different story. For the first time in many years silver stocks are far outperforming and could very well lead the overall PM sector higher. Dave Erlfe joins me to share his thoughts on what’s coming for metals prices and the stocks.

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Comments:
  1. On November 19, 2019 at 11:11 am,
    cfs says:

    Interesting Treasury TIC data today.
    Sure looks to me like foreign buyers of US debt are slowly disappearing.
    https://ticdata.treasury.gov/Publish/mfh.txt
    I wonder how much debt is being monetized.

    • On November 19, 2019 at 4:46 pm,
      JMiller says:

      Really?

      “All foreign investors combined – “foreign official” holders such as central banks and foreign private-sector investors of all stripes – dumped $84 billion in US Treasury securities in September. But compared to September 2018, their holdings were up by a massive $551 billion.

      In the prior month, August, foreign holders had set a record with $6.86 trillion in Treasuries! September was just tick-down from that record and remains the second highest ever.”

      https://wolfstreet.com/2019/11/18/us-national-debt-spiked-by-1-3-trillion-in-12-months-to-23-trillion-but-who-bought-this-pile-of-treasury-securities/

      • On November 19, 2019 at 5:25 pm,
        cfs says:

        Really.
        Rather then summarize like your wolfstreet cite, you might look at the TICData report, which I gave:
        https://ticdata.treasury.gov/Publish/mfh.txt
        which ACTUALLY lists the data for each and every country.
        Note, it is possible for the amount of debt held by foreigners to increase in dollar amount, while the proportion of debt held by foreigners, as a percentage of total debt actually decreases.
        That was the point I was attempting to make.

        • On November 19, 2019 at 7:17 pm,
          JMiller says:

          Well you sure did not do a good job of trying to make that point. That TIC data just shows the amount that foreigners hold in Treasuries, which have been increasing. It does not show the “proportion of debt held by foreigners, as a percentage of total debt” so why use that TIC data if that is what you wanted to show? Wolf Richter’s article shows the percentage for us. The amount of foreign holdings as a percentage of total US debt has been decreasing but not because foreign buyers are slowly disappearing as the TIC data clearly shows foreign buyers are increasing their holdings. The reason why the percentage is dropping is that the total amount of U.S. debt is rising faster.

          • On November 20, 2019 at 10:04 am,
            paul says:

            Good job again JMiller.

          • On November 20, 2019 at 10:32 am,
            cfs says:

            JMiller,

            It is trivial to realize that the increase held by foreigners is a SMALL amount compared with the DEFICIT and thus the proportional of US debt held by foreigners MUST BE DECREASING.

            I guess it just was not obvious to you.

          • On November 20, 2019 at 10:39 am,
            cfs says:

            By giving the TIC data, it also gave the information of which country was doing what.
            e.g. China.

            And also transmitted information (Just a day or so old.) that folks had probably not seen.
            The FULL information, not just a sound-bite.

          • On November 20, 2019 at 11:01 am,
            paul says:

            cfs,

            You sound like a dick.

          • On November 23, 2019 at 8:02 am,
            JMiller says:

            paul,

            cfs is a dick.

          • On November 23, 2019 at 9:31 am,
            Big Al says:

            No, he is a strong conservative who researches his statements and thus gives informed opinions!

          • On November 26, 2019 at 10:34 am,
            paul says:

            JMiller is correct. cfs is wrong.

  2. On November 19, 2019 at 11:17 am,
    cfs says:

    Buried in a stopgap government funding resolution unveiled by House Democrats Monday is a provision that would reauthorize the abusive Patriot Act for another three months, a move privacy advocates warned would ensure President Donald Trump’s administration holds on to “terrifying authoritarian surveillance powers.”

    Evan Greer, deputy director of digital rights group Fight for the Future, highlighted the provision on Twitter shortly after House Democrats released the continuing resolution (pdf), which would temporarily avert a looming government shutdown by providing funding for federal agencies through December 20. A House vote on the measure is expected as early as Tuesday.

    https://appropriations.house.gov/sites/democrats.appropriations.house.gov/files/CR_RCP_xml.pdf

  3. On November 19, 2019 at 3:34 pm,
    CFS says:
  4. On November 19, 2019 at 4:01 pm,
    Excelsior says:

    It was nice to see a number of the Silver stocks in the green today, and overall they’ve held onto their gains a bit better than many of the Gold stocks. It is an encouraging sign, and something one would expect to see in a PM bull market, like the one we’ve been in. This has just been a corrective leg, but within a larger bull market pattern.

    Cheers!

  5. On November 19, 2019 at 4:12 pm,
    Excelsior says:

    (MUX) McEwen Mining Announces Proposed Public Offering

    by @nasdaq on 19 Nov 2019

    “McEwen Mining also expects to grant the underwriters a 30-day option to purchase up to an additional 15% of the shares of common stock and warrants sold in the public offering. ”

    “The Company intends to use the net proceeds from the offering for advancing its current mining projects and exploration prospects, for additional operating capital and for general working capital purposes.”

    “McEwen Mining is a diversified gold and silver producer and explorer with operating mines in Nevada, Canada, Mexico and Argentina. It also owns a large copper deposit in Argentina.”

    https://ceo.ca/@nasdaq/mcewen-mining-announces-proposed-public-offering

  6. On November 19, 2019 at 4:19 pm,
    Excelsior says:

    Junior Mining Sector Responds to Predatory Short Selling; Launches “Save Canadian Mining”

    Terry Lynch

    “Capital formation is an integral part of company building. It provides the resources necessary to hire labour, purchase equipment, and de-risk projects,” said Daniel Barankin, CEO of 6ix and a founder of Save Canadian Mining. “The restoration of the tick test rule will make Canadian companies more competitive.”

    https://www.newsfilecorp.com/release/49806/Junior-Mining-Sector-Responds-to-Predatory-Short-Selling-Launches-Save-Canadian-Mining

  7. On November 19, 2019 at 6:39 pm,
    Chartster says:

    Interesting article, Excelsior.

    The zinc, copper, uranium and everything idustrial metal sector had its washout of many companies. I think industrial metals are the deal right now.

    That said, the gold/silver miners haven’t had the final wash, yet.
    The dog miners in that sector gotta go. And they will.

    • On November 19, 2019 at 7:25 pm,
      Excelsior says:

      Agreed Chartster. I had posted a chart of the main Zinc explorers and developers over at ceo.ca yesterday and will repost it here.

      ___________________

      2019 has been a lackluster year for the #Zinc #Explorers and #Developers. Many of the more popular names here on ceo.ca in the Zinc space had a rough year.

      > This Year-To-Date 2019 performance #Chart isn’t generating much investor buzz.

      $CNX $OM $RTH $FOM $FWZ $SVB $MOON $ZNX $AWE $CEM $TK $VTT

      http://cdn.ceo.ca/1et6n0t-Zinc%20Explorers%20and%20Developers%20YTD%202019%20Performance.JPG

      • On November 19, 2019 at 7:31 pm,
        Excelsior says:

        There was one exception, that being (CD) (CTXDR) Cantex Mine Development, which is a Zinc, Lead, Silver explorer.

        CD had a particularly wild 2019 – from prediscovery, up 700% to inflated nosebleed valuation based on lofty narratives, and then it had the recent return trip back down to Earth. I had pointed out when it’s market cap was over $300 million that as an explorer it was being valued more than (USAS) Americas Gold & Silver (and they’ve been producing significant amounts of Zinc & Lead & Silver the last few years) and Cantex was being valued at about twice what (TV) Trevali was and they have 4 active Zinc/Lead/Silver mines.

        Cantex sold off 22% yesterday and had a capitulation move into today where tons of volume came in and shot down to $.86 and then up to $1.10 and settled flat at $1.00 even. I’ve been buying more yesterday and today, because it has made it’s round trip, but is technically oversold and surely is more valuable now, than where it was prediscovery, but it had gotten waaaaaaaay ahead of itself.

        Check out this wild Cantex (CD) chart of it’s action in 2019:

        http://cdn.ceo.ca/1et6n6u-Cantex%20Mine%20Development%202019%20YTD%20Chart.JPG

        • On November 20, 2019 at 4:26 pm,
          Excelsior says:

          …. and (CD) was up 11% today. Nice.

    • On November 19, 2019 at 7:34 pm,
      Excelsior says:

      As for Copper, it has been sideways to down and very boring, but most of the stocks have had a terrible year.

      On the weekend show blog I mentioned that Copper companies like Entree Resources (ETG), Turquoise Hill (TRQ), SolGold (SOLG), Cornerstone Capital (CGP), Kutcho Copper (KC), and others that got destroyed this year.

      I had also mentioned that I liked (REG) Regulus, but even it sold off 18% just today on the drilling not impressing the markets enough.

      Yes, it has been tough in the Base Metals space.

      • On November 19, 2019 at 7:44 pm,
        Excelsior says:

        My plan is to make some cake in the Uranium market over the next few months and the rotate some of those gains into Lithium and Base Metals stocks in earlier 2020.

        The primary focus of my trading account is with Gold and Silver miners, but I’m still mostly upstream in the peppy Mid-Tier Producers, torqued up Smaller Producers, and I do have a basket of Developers that I believe are great takeover candidates by the big boys. There are a few more exploration stocks peppered in, but only a handful of Gold and handful of Silver explorers as they are far too risky and there are far too many of them to go in too heavy.

        Ironically many of the investors that only had explorers in their portfolios had a blah year or lost money, where the action was in in the producers and they were not properly diversified, so they missed out on all those gains a 2 great rallies in 2019.

        My plan is to once again scoop up any deals into December tax loss selling, but I’m mostly allocated at this point to the PMs.

        Ever Upward!

      • On November 19, 2019 at 8:15 pm,
        Wolfster says:

        The one copper play that has held up fairly well is excelsior and it will be a producer very soon

        • On November 20, 2019 at 10:38 am,
          Excelsior says:

          And they have a great name!

    • On November 19, 2019 at 7:38 pm,
      Excelsior says:

      Lastly, as for the Uranium space, I’m adding to positions this week and the beginning of next, as seasonally we see an upswing in December, January, and early February.

      As a reminder: We are about to get the news from the working group from the US Trump administratin and Dept of Energy in the next week or so. That could be big news for the Energy Sector and in particular Uranium miners.

      _________________________________________

      Brian Laks @brianlaks

      “The working group is very close to its final product…it’s in the final stages of the interagency process within the executive branch…we hope to share it with you very, very shortly” @EnergyDepSec #Uranium

      https://twitter.com/brianlaks/status/1195019332549349376?s=21

      • On November 19, 2019 at 7:38 pm,
        Excelsior says:

        BTW – Markedtofuture – If you see this, I did respond back to you on the weekend show hour 2 regarding CVV. I’m not a big fan for a few reasons, but unpacked it there.

  8. On November 19, 2019 at 7:54 pm,
    Matthew says:

    “Graddhy out of Sweden” at KWN thinks gold has major resistance at about 1484 which also happens to be the halfway point between the 2011 high and 2015 low (I don’t know if he realizes that)…
    https://stockcharts.com/h-sc/ui?s=%24GOLD&p=W&yr=11&mn=0&dy=0&id=p44993989796&a=680989173