Dave Erfle – Will The Precious Metals Sector Just Bottom Out Of Boredom?
Dave Erfle, Founder and Editor of the Junior Miner Junky, joins us to discuss the how this long consolidation in the precious metals and mining stocks, since August of 2020, is quite similar to the large 2 year corrective move that followed the big run higher from January 2016 to August 2016. In addition to the soured investment sentiment and apathy regarding the mining stocks, causing them to drift down on lower volume, there are key levels to watch in GDX and GDXJ that are relevant.
Despite these similarities between the two periods, Dave outlines that actually the valuations in the gold mining stocks are more attractive now than they were in fall of 2018, after that consolidation period, because the producers have better balance sheets, a better gold price, better margins, and most of the quality junior companies are cashed up and still doing meaningful work to advance and derisk their projects. While most generalists are not paying attention to this sector, it is possible that if some upside momentum can get going in the sector once the Fed rate hikes get underway, that the sector may be in the process of bottoming into the boredom.