Weekend Show Preview – Recapping The Fed’s Policy And A Case For The Safe Assets
Mike Larson, Editor of The Safe money Report joined me yesterday afternoon to recap the Fed statement and outline why he is further sticking to his thoughts that now is the best time to be riding safe assets. We get into how gold fits into this picture.
This segment is going on the weekend show but I wanted to share it early with all of you today 🙂
No answer from me because I agreed. Way too much emphasis is put on seasonal patterns.
I look for today’s actions to continue for a while, simply because of all the doubters finally jumping on board. The Iran clusterf__k is a helping of gravy on top of a perfect roast!
Silverdollar – great question, as historically the Summer doldrums marked a low in Gold from 2001-2018 ever year except 3 (2 of those years being 2008 and 2016 which were outlier years).
Personally, I see this recent strength and breakout to new highs in Gold during June (ahead of schedule) as a very bullish sign.
The strength in $Gold so far has been quite impressive.
The yellow metal opened above the 2016 surge high of $1377.50, confirming the next impulse leg higher for the Gold bull market that started after the Dec 2015 low at $1045.40, (and so far has stayed above it without back-testing that level yet).
In addition, Gold is currently above an old prior peak from 2014 at $1392.60.
> I guess DarthFader and the manipulators are on vacation this week. 🙂
+1 Nice Pun! It is interesting the action started to take place after the market closed catching most by surprise and leaving the public out in the cold for a big part of the gold rally. Very well timed and steathy.
Hi Charles. Ha! Thanks.
Yes, good point about how stealth the move was after hours, and how once again (just like the rallies in the first half of 2016, early 2017, fall of 2017, and early 2018) left most market observers in the dust.
People then start the terrible plan of just waiting for a pullback to get back in, and when good rallies get going, the pullbacks are not as deep or extended as people are hoping. This is why it is always good to buy in extreme despair and at least have a partial position to trade around.
GDX, GDXJ, SIL, SILJ all ratcheted higher today 4.5% – 7% and I’m sure many investors were caught with their pants down.
I am surprised Spanky has not chimed in although he did say he was taking the summer off.
Spanky is busy trying to cover his shorts……..lol
I thought that comment might spark a reaction!
🙂
I promised we’d wake Spanky up when Silver was over $18.
So far Gold is on the move, but Silver still has some catching up to do. What is odd is the disparity between where Silver was the last time Gold was at $1392-$1398.
Silver needs to wake up first, then we’ll set the alarm clock to get Spanky up.
An interesting technical chart is Equinox (EQXFF). Often people jump on stocks that have already had a healthy move. No recommendation here but the daily chart will show a higher pricing close then the last high close back in May; the weekly chart pricing could in all likelihood close at a high above the previous high back in January of 2018 and right at the 200 week SMA and the monthly chart pricing could close right at the 50 month SMA with a nice uptrend in the MACD. The question for Excelsior etal is what about the fundamentals for this company. When gold falls back short term again the pricing on this stock could fall back but it appears poised for a run technically.
Good call Doc. Sounds like looking good technically and also has good fundamentals. The company is lead by Ross Beaty who owns 12% with one million shares purchased last year (10/18) at $1.00 (Cd). Ross has a history of making money for his shareholders as well as himself. He regards Equinox as a great chance to take advantage of the upcoming bull market in gold!
Thanks, Florida, for the info. I think I might do more of this when I see the possibility of a technical run. Even though I look at the fundamentals as well as the technicals, I rely on guys like you, Ex, and Cory etal to give me your take on the fundamentals. I have had a healthy position in this stock at a favorable price and added today.
Hi Doc. I like Equinox for a number of reasons, and have a nice position in it as well that I started building last fall. Here are a few fundamental tidbits to mull over:
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1) A few years back, I had watched Luna Gold get off to a rough start with their Aurizona Mine and good ole’ (SAND) Sandstorm looked for options on how to get them out of the failed launch into production.
2) The next suitor (TREK) Trek Mining tried to initially roll Luna Gold’s Aurizona mine up with (JDL) JDL Gold Corp ( which was a roll-up of Lowell Copper, Gold Mountain,and Anthem United). There were some interesting copper assets there because of the legendary David Lowell’s work, and some extra Gold exploration properties, but the combined company didn’t do that hot either. (Despite Marin Katusa’s promotion).
3) Ultimately Trek ( the love child of Luna Gold + JDL Gold) merged with (NCA) NewCastle Gold, (a single asset developer with the Castle Mountain Mine) + (ANF) Anfield Gold, (Ross Beaty’s failed explorer that had cash from selling off it’s properties when they underwhelmed), and they formed the modern day (EQX) Equinox Gold. Ross Beaty took the cash from Anfield, Newcastle, and Trek and did a massive rollup relaunch and that is when I raised an eyebrow that it just may work this time.
4) Next up the did some divesting last August by selling their Koricancha Mill in Peru to (IO) Inca One (a growing toll-milling operation there), and then spun out the Copper assets into Solaris Copper, (which is still private at this time), but may represent future value when they take that public.
5) Next up last September they went shopping and bought the Mesquite Mine from (NGD) New Gold in California, since NGD was struggling financially at the time, and that got them into production, which was key milestone.
6) Most of 2019 has been financial raises, key investors and funds strengthening the balance sheet, and just last month in May they finally poured Gold again from the Aurizona Mine (Luna Gold’s old asset) and it looks like they are going to do it right this time. So that makes 2 mines in production, and Castle Mountain (Newcastle’s old asset) will be next and make mine number 3.
7) They also just divested their non-core Elk Gold property to a private company – Bayshore, to raise some more funds and they have some more funds due over the next 2 years.
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All in all there are a lot of moving parts from all the prior rollups & rollouts, but (EQX) Equinox Gold is the culmination of a half dozen old companies that has trimmed the fat, spun out what was non-core, and they have a good pipeline to work from now with 3 mines and a solid team.
Lastly, they have a ton of prominent Gold promoters involved due to Sandstorm’s tie-in, Rick Rules financing, Marin Katusas promotions, and of course Ross Beaty making this his last big Gold company to build before retiring.
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Check out Page 24 on their corporate presentation:
https://www.equinoxgold.com/_resources/investors/presentations/EQX-PPT-20190603.pdf
nice 13% insider ownership, 23% Institutional ownership, and 23% High Net Worth investor ownership. Those investors are going to hang onto their stock and I figure they’ll do all the promotion for me, so I can just sit back and ride it up this cycle. There is only a 41% float in the shares, so that puts it on pretty strong footing.
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That’s my recap on EQX and its one I plan on holding a core position in through the whole Gold & Copper cycle.
Ever Upward!
I might add the volume in EQXFF has picked up considerably over the last year.
That helps too. I believe the strategy is starting to get traction because they spun out the non-core assets = smart, and spun out the Copper assets into Solaris (future upside).
Last year they made their focus clear and by putting their attention on their Aurizona Mine and Castle Mountain Mine. Then they pulled a rabbit out of their hat by purchasing he Mesquite Mine from (NGD) New Gold and graduated from a developer to a producer overnight. Now they have Aurizona in production finally, so they are gaining traction…. right in time for Gold prices to cooperate.
What’s not to like, eh? 🙂
Ex, thank you a lot. Doc.
Glad to share. The section further up on EQX was detailed, but for a reason. Some of the marketplace knows Ross Beaty has a final Gold company and they have a few mines going, but I don’t think most investors realize how many different companies all got rolled up into Equinox from one incarnation to the next, nor kept track of their divestments and acquisitions. I’ve been impressed enough so far over the last year to just keep holding until the analysts and generalist investors start wading into the PM sector and realize what they have in front of them. It’s not going to have the most leverage, but I see EQX as just a solid Mid-Tier company, like a MUX or AR.
Doc, did you ever buy any SLB ? Glad I bought@35.
Did you ever buy any IMBBY? I bought more today@23.70 yielding over 10%
BB; I haven’t. They’re on my watch list. SLB is at its’ 200 month SMA and I have time to see if it holds here. I believe IMBBY has a chance to move down to 15 yet. Remind me periodically like you have been and I’ll tell you when I think they have bottomed. SLB may be bottoming but IMBBY looks like it’s in freefall mode yet.
On May 31 the following was posted on Doc’s interview:
On May 31, 2019 at 1:39 pm,
Silverdollar says:
I certainly wouldn’t try to argue with Doc’s wisdom in trading but I think it’s possible that Mr. Market could do it’s thing earlier than the seasonality charts suggest. Must we still experience lower lows at the end of June and into July? Why couldn’t things come together a bit faster, like the first couple weeks of June? It would certainly catch a lot of people waiting, wouldn’t it? jmo
For some reason the question didn’t elicit any answers. Anyone have anything to say now????