Dave Erfle – If You Have Cash In This Market Here’s What To Look For In Beat Up Metals Stocks
Dave Erfle, Founder and Editor of The Junior Miner Junky joins us to focus on the selloff in precious metals stocks. We look at the best ways to build cash and redeploy the money into quality stocks. We also tie this into the downtrend in every other sector within the markets. If this truly is a bear market there could be downward pressure for a while longer.
Click here to learn more about Dave’s newsletter – The Junior Miner Junky.
GDX has yet to break its ‘B’ point. GDXJ just did.
Dollar Index top at 105.01 ??
Today both GLD and SLV may well have bottomed.
Note 1.382 expansion of the 4/18-5/2 stretch.
GDX ‘B’ breakout needs to have power.
(The Dollar may be teetering.)
Gold holds after spike down pop.
GDX could not break through.
‘Possible’ — until Monday.
Scorpio, SGN…
Yep, big move in Scorpio on the drill news released. 16.80 meters Grading 27.16 g/t Au, Including 3.1 meters Grading 145.74 g/t Au.
I was so excited I forgot to look for news, haha. I don’t own much but it is in a buy and forget it account.
Good volume and its first close above the 100 day MA this year…
https://stockcharts.com/h-sc/ui?s=SGN.V&p=D&yr=1&mn=3&dy=0&id=p87993774984
Looks like GROY failed in their takeover of ELE (happy for Fred and his team, and happy as an existing shareholder). Can’t say it surprises me, because this hostile all shares bid was not an accretive offer for shareholders of Elemental, as the company pointed out in multiple press releases, especially after Gold Royalty’s shares went down the drain in valuation. Glad I took profits in 60% of my my Elemental position when the takeover news broke the end of last year. Now that the drama has passed, I may add a bit back to my position, in case there is a superior takeover offer that comes in from a better royalty company.
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(ELE) (ELEMF) Elemental Royalties Confirms Expiry of Unsuccessful Hostile Takeover Bid by (GROY) Gold Royalty
12 May 2022
https://ceo.ca/@newsfile/elemental-royalties-confirms-expiry-of-unsuccessful
At least we are getting a nice green day in the resource stocks today with gold, silver, copper, uranium stocks bouncing up nicely.
We had laughed a while back about people saying governments were embracing cryptos and pointing to bastions of influence like El Salvador as their proof case, and had quipped “What could possibly go wrong?”
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El Salvador’s Failed Bitcoin Experiment: Country Expected to Default as Crypto Carnage Continues
May 13, 2022
“A number of global factors, including rising inflation and subsequent interest rate hikes, the war in Ukraine, and the looming potential of yet another recession has caused traders to offload their riskier assets, sending the price of bitcoin plummeting over 50% from its record-highs. Also derailing alongside bitcoin’s slump has been the government of El Salvador’s bonds, which are now trading at around 40% lower than their original value, all because President Nayib Bukele’s ambitious plan to make the South American country the first in the world to adopt to volatile digital token as legal tender alongside the US dollar.”
Fed is still buying securities. QE still lives. With > 10% inflation, .5% rate increase is NOTHING. Stop the fear mongering. What happened to measured move on GDXJ to 92?
You’re exactly right. Rate increases of .5% are nothing under the current circumstances (as I showed recently with a history lesson of the 1970s action). The herd (left AND right, btw) will always discard the facts that don’t square with their perceptions. Remember when most here including Al and most of his guests (including Doc) thought the Dow was in a big bubble when it went above 13,000? They must’ve been impressed with the big number because it was no bubble by any legitimate definition. But I digress…
The situation today is in fact much worse than the 1970s which only bolsters your view.
Last 3 weeks:
Been to Texas and back concerning hospice issue. Friend of family.
Added to over the period:
Tripled Group Ten
Impact
Emerita (and sold some)
Osisko Metals
Libero Copper
Copper Lake
Theralase
Silver Tiger
Millennial Precious
New Purchases (again)
Eloro
Alexco
Today a good day but basically buying and holding from the bomb shelter. Central Bankers are having some concerning days. Looking to buy Omeprazole stock.
Hi Lakedweller2. Glad to have you back posting again and sorry to hear about the hospice situation with a friend. Thanks for sharing some of the companies you’ve been trading lately. Ever Upward!
thx ex
It’s crazy how one day of positive (so far) action provides powerful hopium after such a severe beating.
I’ve voiced my expectations with respect to the miners over the last couple of months but let me just summarize what I expect. To be fair, I am somewhat conflicted based on the charts about how this will play out.
First, one of the weekly ratio charts that I keep a keen eye on is SIL vs the Nasdaq (I also sometimes use the SOXX) as well as individual silver miners vs the nasdaq. Looking at their weekly charts and long term moving averages, they all display a similar pattern that I have seen resolve as an absolute explosion upwards. I expect this explosion to begin anytime between now and the end of July. And when I mean explosion, I mean virtually straight up for a year+.
However, looking at individual silver miners, like AG, AXU and ISVLF (IPT), I have a hard time seeing them break above their 100 WMAs until early 2023.
So I am not sure how this is actually going to play out. Ratio charts are tricky because you could actually have SIL rally vs the Nasdaq, yet they both go down in absolute terms, albeit this is not typical, especially when you see explosive moves upwards.
GreeN:
I know what you mean but there is a lot of bad stuff going on out there and you never know when fundamentals might mean something. Just look at the value of the Ruble and all that talk about a commodity-based fiat … other than in the Western World. It must mean something. “When” is getting to be an interesting word.
Green, I believe the following statement by you is the most accurate as to the future: “However, looking at individual silver miners, like AG, AXU and ISVLF (IPT), I have a hard time seeing them break above their 100 WMAs until early 2023.” We have one day up and all the usual suspects go “nuts”. The odds are better then 50% That we continue to head down in the PMs over the next 2 weeks. Regardless the odds are very favorable that we move down in gold to the low 1700s. Having said I’m now gradually purchasing on this recent dip—if we don’t see a massive move until early 2023 which is a good probability and I concur it will be later then sooner, I just keep purchasing small amounts when technicals are favorable. There is no hurry since the general market has further to fall as well. Doc.
Well, my focus on the 100 WMA really has to do with when the 100 will cross below the 200 WMA for each of those stocks, I think especially with AXU and ISVLF since their 50 WMAs have really rolled over hard.
It’s possible, for example, that AXU’s 100 WMA could cross below the 200 WMA as early as October of this year. I also think it is quite possible AXU could put on massive rally back to the 100 WMA in a 2-3 month span starting any week now and then be range bound between the 100 and 400 WMAs until the 100-200 cross occurs.
Keep in mind, this is probably the most bullish scenario out of all the possible bullish scenarios from a timing perspective. The 100-200 cross is just a prerequisite before AXU can permanently retake the 200 WMA IMO. So that doesn’t mean price has to explode above the 200 WMA right at the time of the cross, but that is the most bullish scenario from a timing standpoint.
Finally, a move to the low 1700s is not something I am expecting at all, but I suppose anything is possible on a spike low. I think gold’s 50 WMA is more than close enough now to the rising 200 WMA that it can explode upwards at anytime, i.e. I think we have more than satisfied the price and time element at least based on history.
Also, while I acknowledge the beatings might continue for a week or two more, if today ends up actually marking a major pivot low, I think it is highly likely we could rally for a week or two and then retest today’s low or even marginally break it exactly one month from today (so mid-June). Hopefully that would create a classic divergence associated with a final low and be the spring board for a very large and explosive rally (e.g., AXU testing its 100 WMA or at least its 200 WMA).
Doc: You are usually right. Just very frustrating in view of the mess things are in.
The COT commercials improved for the PMs but gold still high in shorts compared to silver. The next 3 weeks should continue to see the short spread weaken.
The real story regarding IPT’s 100 WMA is that this plunge delayed its crossing above the 600 WMA for the first time in 16 years. The fact that the 100 is now pointing down in no way guarantees its eventual crossing below the 200.
https://stockcharts.com/h-sc/ui?s=IPT.V&p=W&yr=7&mn=3&dy=0&id=p30423034958&a=1164591953
In case the chart above is limited to 5 years…
https://stockcharts.com/h-sc/ui?s=IPT.V&p=W&yr=7&mn=3&dy=0&id=t8441573852c&a=1164591953&r=1652476242495&cmd=print
Relative to the 500 day/2 year MA, gold hasn’t been so weak since last August. A drop to below about 1764 is probably unlikely.
https://stockcharts.com/h-sc/ui?s=%24GOLD&p=D&yr=2&mn=0&dy=0&id=p10841319574&a=1160146764
Silver could have easily seen its low today even if gold hasn’t.
https://stockcharts.com/h-sc/ui?s=%24SILVER&p=W&yr=3&mn=0&dy=0&id=p92559766219&a=1163733918
Folks—
Welcome to times have changed & popping of everything bubble. To be clear, dip buyers haven’t figured this out yet. Me too, blinded by inflation, didn’t see cash is KING. Therefore, I’ve bit bullet, raised cash to avoid margin calls & have started a position in UVXY. I’ll buy dips & sell rips, & like Doc, nibble on waterfall declines in quality JRS, rinse & repeat.
P.S. I was a rookie stockbroker & watched Black Monday meltdown real time live on screen. Downside protection essential, now more than ever—
PPS: Like, portfolio insurance?
PPPS: Chess Boyz in it—
To win it…
PPPPPS: Twitter shall tweet the record strait/ straight// queer??
¡OLE!
Ademas, when bitcoin plunges below 20,000, PM’S drop in concert to Joe six-pac bailing to takin it to bloody streets. Twit Oh Sphere on that…..
Trend Turn Table: https://tinyurl.com/mt2berap
PMs very likely bottomed yesterday. Noted.