Where Sean is investing and comments on Precious Metals Stocks
Sena Brodrick kicks off today discussing the sectors he sees opportunity in. As crazy as the markets continue to be there are some great values for the long term investor. We also touch on the precious metals stocks and the stocks he is recommending.
Paul, it was all an illusion. DT
DOC‘s prediction is April/May for the sell-off
Yes, Doc projected lower prices for the PM miners going into April & early May where he’d be accumulating and buying those dips.
If we see any weakness return in the next 3-5 weeks, then it will be a good time for topping up positions in the miners. I’m mostly invested at this point, but have kept some power dry and am working on increasing my cash position from winning swing trades to be able able to take advantage of any Spring sales the present themselves.
With Gold heading back up to $1732 again today, and most of the miners surging higher on the day 5-20%, I’m happy to have added to many of my key positions in March, as this rally has refilled the coffers and just about got me back to where I was in my account in late February before the crash in the PMs and miners.
You are a good trader 🙂
I thing, we will test the lows again. At the moment it looks like Docs prediction was to early.
The question on my mind now is whether to trim some of these back into this recent strength (in case things do cool off and pull back in mid-April through early May), or if I should hold onto these positions if they continue to keep breaking out.
A retest of the lows in the gold sector is highly unlikely in my opinion. While the Fed buys everything except gold and the gold stocks, smart money will flow into them for their stellar fundamentals and appealing valuations.
NEM just hit its highest level since December 2011…
https://stockcharts.com/h-sc/ui?s=NEM&p=W&yr=9&mn=5&dy=0&id=p68805546580
In fact, anything even close to a retest of the lows is highly unlikely.
SLV vs GLD is at a very important level right now…
https://stockcharts.com/h-sc/ui?s=SLV%3AGLD&p=D&yr=0&mn=5&dy=0&id=p38791795125
Mines are shutdown and we will see a hard recession. That will have an impact.
Not all mines are closed and the rest will reopen. The hard recession will be good for mining since it will keep energy and labor costs in check. In addition, the metals in the ground will keep the miners well-bid as they increase in value along with the prices of gold and silver.
There will always be pullbacks but there is no good reason, technical or fundamental, to expect a retest of the lows which were driven by panic (emotion) and margin calls and happened before the Fed did what a few of us knew it would: launch QE-infinity.
There is an amazing proliferation of Hedge Funds. Their interrelations have become so elaborate and so complicated that it is impossible to tell their worth. It will only get worse when this mess starts to unravel as it now is and some sort of value needs to be assigned to these wildly speculative companies. DT
Some of those hedgies are going to get served and blow up, and they’ve only excelled in an environment where most stocks strictly went higher, and certain asset classes only went lower that they shorted.
Time for the Great Reset.
Scorpio Gold’s management is setting a very good example…
Scorpio Gold announces voluntary reduction in wages and salaries throughout the company during the Covid-19 pandemic and until a major financing is achieved to build the Mineral Ridge Process Facility
Effective April 1st, 2020 with the full co-operation and understanding of the Company’s personnel:
US employees voluntarily agreed to salary and wage reduction of 20%;
CEO, CFO and Corporate Secretary voluntarily cut their salaries by 50%; and
Chairman and Directors agreed to waive all monetary compensation to zero.
The overall annual reduction in costs will be approximately Cdn $1.6m and will remain in place until the Company is financed.
The Company will continue to produce cashflow from the existing heaps at the Mineral Ridge Mine throughout 2020 whilst continuing to pursue financing in the form of gold loans, gold streams and direct loans to fund the expansion of production via construction of a new CIL process facility at the mine. Recent gold prices have reached as high as US$1,700 per ounce of gold compared to the US$1,250 per ounce used in the Company’s 2018 Feasibility Study, an increase of up to $450 per ounce or 36%.
Drilling has commenced underground at the Goldwedge Mine in Nevada with results expected in early May.
Engineering of the new flotation circuit at the Goldwedge Mill Facility is complete and the Company will be submitting the project for approval this week. Lode-star is directly funding the cost of this addition (see news release dated January 27, 2020).
https://www.accesswire.com/584274/Scorpio-Gold-Cash-Conservation-Measures-in-Response-to-COVID-19
If only more mining companies would take a page out their book. Something tells me most mining company executives are going to keep milking the G&A even during their company shutdowns.
It’s really a bizarre set of circumstances that most mining companies are in though.
Most sane market watchers anticipated these higher Gold prices, as they watched the insane policies come out of debt-ridden nations, and central bankers all over the world print new magical money from nowhere like there was no tomorrow. It has been the fiscal mismanagement that is the real driver of the higher PM prices.
However, these global lockdowns on mining company operations, due to the coronavirus, were not anticipated as part of the equation for when metals prices finally surged.
Now, ironically, when companies can finally make some real money mining Gold, they are forced to shut down their operations. It’s a bitter pill to swallow.
This is really the time the Gold miners need to be running full steam ahead, and making hay while the sun in shining.
On the other hand, ridding the mining space of weak hands will only lead to more impressive gains when this virus operation passes. We are still in for a huge bull market.
Yes, it is time for a culling of the herd.
The action in Barrick and Newmont speaks bullish volumes about the whole sector…
https://stockcharts.com/h-sc/ui?s=GOLD&p=W&yr=7&mn=2&dy=0&id=p19898875220
The same goes for tiny JAG…
https://stockcharts.com/h-sc/ui?s=JAG.TO&p=D&yr=1&mn=5&dy=0&id=p66792726818
Yeah, (JAG) has been rather peppy lately and it looks to be stretching up to reach for that gap up & down that occurred in the $.24-$.245 area.
LOL. Speaking of culling the herd, if they had culled me in 2001, I would not have owned all these miners and be spending my Amazon, Chipolte and Tesla earnings. But no, I had to learn about fundamentals of the economy rather than stay brain dead.
The forward-looking market is starting to price-in vastly improved profitability. The gold hedges were gone way ahead of guidance from the Sept. MD&A and the average Q1 gold price is significantly higher while oil is significantly lower. And this is just the beginning, in my opinion.
Yeah, I’m glad JAG finally worked through and got rid of their gold hedges in this rising price environment, and am interested to see how things went for them in their Q1 Operational report.
Really I’m pretty excited to see most of the gold producers Q1 operational and financial reports, as most of them should have been printing money at $1500-$1600 gold prices, and the favorable lower Oil prices.
Haha! David the knowledge will pay off in the long haul!
Also there was nothing wrong with having a mix of exposure to both the general equities and the commodity space over the last 2 decades. There are seasons and cycles for every asset class.
My guess is that the Q1 gold price has averaged $100 more than Q4. With AISC at $1349 before oil crashed and the removal of hedges that capped gold to $1363, Q1 results should be relatively spectacular.
Here’s an interesting point on the currency exchange rates that should help as well on driving down costs for Jaguar from another contributor over at ceo:
__________________________________
@Research67 – “A little fun with numbers on a isolated Saturday morning. As I post this, I’m sure the numbers are changing, but the point will remain the same and the numbers are likely changing for the better. As I have posted several times already, the Brazilian real is loosing value to the US dollar at an incredible rate, as of a few minutes ago $1USD = $5.35 Brazilian Reals. On Jan 1st 2020 one ounce of gold in Reals was approximately $6100 Reals, it is now $8660.35 Reals, an increase of 42%. On the flip side one ounce of gold in the US was approximately $1525USD on January 1st and is now at $1648USD, an increase of roughly 7%. 2020 will be a significant turning point for Jaguar Gold, regardless of the gold price manipulation in the US markets. In inverse order, I am very much looking forward to Q1,Q2 and Q3 2020.”
Maybe governments understand gold is going thru the roof and they intend to nationalize the mines.
If they do think that way it makes perfect sense they wouldnt want to give the gold away.
Any country without gold doesnt get a “seat at the table” as Rickards puts it.
A general look at China and its gold market in wake of COVID-19
Ray Jia – Research Manager -World Gold Council
https://www.gold.org/goldhub/gold-focus/2020/04/general-look-china-and-its-gold-market-wake-covid-19
Think of the American investments abroad particularly in China. All that lost technology to the Chinese and soon China will nationalize the American industry that was so foolishly allowed to set up shop there. DT
Think you know how the gold market works? Comex, LBMA, Coins, Bullion, Confiscation, derivatives, Gata, on and on. This discussion with with Jeff Christian is as good as it gets and blows the hell out of a lot of conspiracies. Do yourself a favor if you want an advantage in the coming months/years. JMO
https://www.macrovoices.com/
Did Jeff Christian go to the same school as Bob?
The silver guru has a gata poster behind him on some of his u tubes.
Andrew Maguire @ kwn.
Geez there are alot of people in the PM space people need to be wary of.
Same school? There are some similarities. Jeff did get a bit personal in naming Maguire. Interesting fact that if one looses their securities license, they can go into PMs where there isn’t a license required. Hell, even a used car lot needs a couple licenses. True, one must stay wary……….and healthy!
Christians…..I think is wrong on 1-2% inflation…….He has been listening to the govt to long on the fake numbers…….I would like to see his charts…..just staying.
If, he referring to 1-2% during the mid 80s he is all wet.
Fuzzy math at best. From Greenspan forward…..inflation is a lot higer than 1–2%…
Gold keeps up with long term inflation and that number is 7-9%.
Inflation rate……….
At 1%………….an item will double in price in 72 yrs.
At 2%………….an item will double in price in 36 yrs.
Tell me what the rate of inflation would be on a house, car, utilities….food…
(REX) (ORMNF) Orex Minerals and (PAAS) Pan American Silver Corp. Agree to Form Joint Venture for the Sandra Project
26-Mar-20
“The Sandra Project is a consolidation of two groups of claims, each controlled by the two participant parties. Orex and Pan American will own a 40% and 60% interest, respectively, in a new joint venture company that will be formed for the Project. Each of Pan American and Orex will be obligated to make contributions to the joint venture company in proportion to their respective ownership interests and Orex will be the initial operator of the Project, subject to the terms and conditions of the shareholders agreement between the parties. Orex intends to finalize an initial program and budget with Pan American and commence work on the Project as soon as possible.”
Orex’s President, Gary Cope said “We are very pleased that we have finalized this new joint venture arrangement, which allows Orex and Pan American to continue the advancement of the Sandra-Escobar project, previously initiated in our joint venture with Canasil Resources Inc.”.
This JV strategy is a good one for many of the Jr Explorers and Developers need to be considering right now as the right path forward.
> I look forward to seeing more of these kinds of JVs between the Jrs and Big Boys.
World’s Largest Uranium Miner Cuts Production; Price Starts to Run
April 7, 2020 – Derek Macpherson | VP, Equity Research Analyst – Red Cloud
“Pandemic related production cuts have translated to the uranium price increasing as the 2020 supply deficit grows. Kazatomprom announced that as a result of COVID-19 countermeasures being implemented in Kazakhstan, 2020 production guidance was reduced by 4,000 tU (~10.4M lbs U3O8e). This production cut along with already announced shutdowns from other producers of at least ~2.4 Mlbs U3O8e drives our current estimate for 12.8 Mlbs supply deficit in 2020, which is 6.7% of estimated market demand. It is important to remember that only a few weeks ago we had expected the market to be roughly balanced (~0.2M lb deficit). The sudden and now substantial market deficit has resulted in the spot uranium price increasing 14% since March 23, 2020.”
https://s3-us-west-2.amazonaws.com/cdn.ceo.ca/1f8sk0p-20200407-Kazatomprom-Curtailment.pdf
Most stock anaylst calling for bounce in stocks and another test of the bottom when we see earnings and economic fallout from this virus. If people get caught in another sell off in couple months Junior gold stocks could get sold off again. Control greed and when this economy is on solid recover then you can buy Junior gold stocks for long term inflation.
It’s too early and risky.