Outlook for gold, the US Dollar, and US markets
Doc joins me today to share his outlook for gold, the US dollar, and US markets. We also discuss a couple stocks that Doc has been buying in the metals space.
Doc where do you see gdx bottom Target will be by year end? Tax loss selling is almost done and gdx has bounced off 26 level I think 3 times, so how much lower can it go if you say gold will possibly break below 1450?? Thanks
True bull markets come with real gains and the miners are delivering just that. Conversely, conventional stocks peaked about 15 months ago in real term despite the recent new nominal high. Despite being up 18% versus gold since 12/2018, SPY is still down 12% versus gold since 9/2018. Yet those who believe the dollar is a worthy numereraire think SPY has risen 10% since 9/2018. It hasn’t and this is why gold bulls do not need to worry about stock market strength. In real terms, the stock market is facing a stiffer headwind.
https://stockcharts.com/h-sc/ui?s=%24XAU%3A%24GOLD&p=W&yr=11&mn=11&dy=0&id=p29695819544&a=471646105
Matthew – good posts today and great analysis on the general markets priced in gold and everything not being as rosy as most assume looking at them priced in dollar terms versus real terms.
Also a solid point on why gold and miners can still do well even with the backdrop and perception of strong general markets.
Thanks Ex. The potential for big gains is much better now than it was at the May low, in my opinion. The HUI is up 58% vs the S&P since last year and 40% since May despite being 13% away from the August high. Now it’s about to re-enter the steep fork support that it fell out of a month ago and that could result a quick big move higher.
https://stockcharts.com/h-sc/ui?s=%24HUI%3A%24SPX&p=W&yr=4&mn=5&dy=0&id=p26734819882&a=628386864
Now compare the following two charts. they show that the silver stocks are a “wave” behind the gold stocks. Among other things, this could mean that the gold stocks might (just might, not will) enjoy some support from the action in the silver stocks when they correct from the 5th wave top since the silvers will be starting their 4th wave decline at the time and their 5th wave will still be ahead.
https://stockcharts.com/h-sc/ui?s=GDXJ&p=W&yr=4&mn=5&dy=0&id=p86356799196&a=704768474
GDX perfectly ended its pullback at Weinstein’s steeply rising 30 week MA and couldn’t look better…
https://stockcharts.com/h-sc/ui?s=GDX&p=W&yr=6&mn=5&dy=0&id=p13004662221&a=512023944
Ah yes, the Weinstein 30 week MA – 4 stage method. I haven’t thought about that in a while so thanks for bringing it up, as I need to run a few miners weekly charts now with that in mind.
Interesting thoughts along the Elliot Wave 5 wave count system where Gold miners are ending Wave 4 heading into Wave 5 up and Silver miners are a bit behind the Golds with their Wave 4.
I’d imagine that a nice upmove in Gold would still support the Silver and Silver miners, and vice versa; a nice move higher in Silver and Silver miners would be bullish for the Gold and Gold miners.
Yes, being out of sync should cause one to support the other along the way. If they were in sync and completed wave 5 virtually together, we’d probably be in for a much sharper decline and more protracted consolidation. However, since the silvers will be ending wave 3 as the golds end wave 5, the golds’ post wave 5 correction should get a lift from the silvers ending wave 4 and starting wave 5. Then, by the time the silvers start their post wave 5 correction, the golds will be nearing a new wave 1 advance. OR maybe they will somehow get in sync in the months ahead.
By the way, since wave 3 is often the strongest of the “up” waves, we should see our silver juniors perform far better than they did between May and September.
Very interesting and I’m all for a strong Wave 3 for the Silver miners before going into Wave 4, and outperforming the action from May to Septemer will be a wonderful thing. The Silvers were doing well the last few days.
Someone get AVI
I googled him and found the following piece from November 28. He’s bullish but doesn’t go into his charts to shed any light on the validity of my little theory.
I bet he’d agree that today’s pullback is for buying!
https://seekingalpha.com/article/4309608-sentiment-speaks-metals-getting-ready-to-skyrocket-again
Corvus Gold drills 50.3 m of 1.5 g/t Au at Mother Lode
2019-12-05 09:29 ET – News Release
Mr. Jeffrey Pontius reports
CORVUS GOLD EXPANDS MOTHER LODE DEPOSIT INTERSECTS NEW DEEP INTRUSIVE ZONE BELOW MAIN DEPOSIT WITH 50.3M @ 1.50 G/T GOLD
Corvus Gold Inc. has received initial assay results from its phase 4 Mother Lode resource expansion drilling program (see attached table). Both holes returned positive results from the southwestern part of the deposit, where Main zone mineralization has now extended to the southwestern part of the resource area. The company believes that this southwestern extension of higher-grade mineralization has demonstrated potential for the deposit to continue expansion in multiple directions and now at depth, with hole ML19-119 intersecting 50.3 metres at 1.5 grams per tonne gold in a newly identified intrusive zone.
These initial phase 4 holes are part of a 30,000-metre drilling program (core and reverse circulation) targeting a major increase in size of the Mother Lode deposit. Corvus expects to complete the phase 4 program by mid-2020 with follow-up drilling, as needed, in the second half of next year. Phase 4 is designed to: expand the current mineral resource of the deposit; test the deep “North Extension” and “Core” targets; and test the down-faulted western extension of the main Mother Lode deposit (west of the Fluorspar Canyon fault). In addition, Corvus plans to update its district-wide resource base and mining studies, which will incorporate 35,000 metres of the recently completed phase 3 drill program as well as results from the continuing phase 4 program.
Southwestern Mother Lode and new deep discovery
The initial two holes in the southwestern area of the deposit indicate that the higher-grade (greater than two grams per tonne) part of the Mother Lode system extends farther to the west than previously modelled and could link up with the zone intersected in hole ML18-073 (48.8 metres at 1.19 grams per tonne gold, including 22.9 metres at 1.74 grams per tonne gold), which is approximately 100 metres to the west. In addition, a new, deep, intrusive-related gold zone was intersected in hole ML19-119 below the main Mother Lode deposit in Paleozoic carbonates, which could represent leakage up dip along the major central dike system that may be related to the new geophysical anomaly at depth (approximately 150 m deeper).
The miners (HUI,XAU,GDXJ,SIL,SILJ) generally bottomed in mid October (almost 7 weeks ago) and are up significantly since. So much for the big June gaps getting filled and GDX going to 24. Many are surprised by the miners’ divergence from gold but it should have been expected considering gold’s performance. The strength displayed by gold since May told us that the move was for real and the miners have confirmed it with their action since mid October.
The XAU’s close today was its highest in 17 months when priced in gold…
https://stockcharts.com/h-sc/ui?s=%24XAU%3A%24GOLD&p=D&yr=1&mn=5&dy=0&id=p74168274544