Dave Erfle – Encouraging Strength In The Mining Stocks During The Pullback In Gold And Silver
Dave Erfle, Founder of The Junior Miner Junky, joins us to review the encouraging strength in the precious metals mining stocks, and how they have held onto some gains despite the corrective move we’ve seen in gold and silver as the geopolitical premium came out of the markets since the end of last week.
We start off by reviewing the generally bullish longer-term technical setup in gold despite the recent pullback, and that Dave is looking at support levels like $1921, $1900, $1880, and $1850. $1921 has been tagged several times recently to close up last week and even in as the markets closed today. $1900 is still strong support on the monthly chart.
GDX has confirmed a bullish cross on the moving averages, and GDXJ has marginally broken above the $47 resistance a few times, which is a bullish signal that got some junior miners moving higher recently. Dave feels the base of support has built in the metals and miners, and that more projects will start incorporating the higher metals prices in their valuations and economic studies. We wrap up with a few thoughts on some recent mergers and acquisitions and how this trend is likely to keep unfolding with some juniors still at lower valuations while the larger companies are moving higher and looking to replace ounces in the ground.
Click here to visit the Junior Miner junky website to learn more about Dave’s newsletter.
A Hawkish Fed & Gold
Stewart Thomson – Mar 22, 2022
“Fiat money is borrowed, printed, and extorted from US taxpayers… Fiat kingpin Jay Powell has finally acknowledged the inflationary tidal wave that is ravaging the world.”
http://www.321gold.com/editorials/thomson_s/thomson_s_032222.html
Ira Epstein’s Metals Video (03/22/2022)
#TechnicalAnalysis, Gold, Silver, Copper, Platinum
Futures green before open.
Timing good as my portfolio had Monday even….Tuesday Down…so that makes Wed up…
Good morning Lakedweller2 – Yes, it looks like there is some green on the screen to kick off Wednesday, and as Dave Erfle mentioned in the interview above, overall, the strength in the gold & silver mining stocks the last 2 weeks, in the face of correcting metals prices, has been a nice divergence and is bullish for the PM sector.
It’s been nice to see many stocks in my portfolio in the green and making upward progress both last week and so far this week, when I was expecting them to get hit a bit harder on the pullback in the metals. However, I’m a bit more weighted to the mid-tier and smaller producers, and some of the more prominent developers, and they’ve held up better than the optionality plays and explorers have overall. GDX, GDXJ, SIL, and SILJ have also done pretty good holding onto more of their gains and have been outperforming the metals, so that is the kind of action we want to see. Cheers!
It was also nice to Gold settle in afterhours trading yesterday right at that $1921 support level again, and then bounce in overseas trading. So far in early morning trading Gold has been trending around in the mid to high $1920’s (currently around $1925.50).
Also Silver hasn’t been discussed as much on here or in interviews, but I’m very encouraged that it’s been hanging around the $25 level, and that it didn’t breakdown to $22 (much less to the $18.50-$19) area that many were projecting earlier in the year or even as recently as last month. Silver hasn’t been raging higher on strength, but the fact that it has held it’s own in 2022, and many days was outperforming Gold was another bullish factor stacking up.
While the $1921 and $1900 levels should still be good support, and it would be great to close the week, month, and quarter above those levels… even if Gold does fall out of bed and correct down even further, then there should be good support down at $1880 as Dave Erfle noted.
If the corrective move does break down through $1900, then the 55 day EMA currently at $1888 would be a place to see more support come in, as noted on this chart.
Pivoting over to the miners, and since Dave Erfle highlighted the significance of GDXJ breaking above and holding $47 to get more momentum trading going in the sector, it looks like there is a confluence of moving averages in the mid $43’s, so that area would be good support if we saw any further corrective action. However, as Dave also noted, it is encouraging to see the shorter-duration moving averages crossing up through the longer-duration moving averages (Golden Crosses) on the daily charts for GDX and GDXJ.
Here’s a chart of GDXJ for quick reference showing the 55 day EMA crossing up through the 144 day EMA and the 233 day EMA.
This was a good piece that our buddy Robert Sinn put out yesterday on the difference between a trade on an equity position, and someone’s fundamental opinion of that company. Worth the quick read.
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The Difference Between An Opinion And A Trade
by @Goldfinger on 22 Mar 2022
https://ceo.ca/@goldfinger/the-difference-between-an-opinion-and-a-trade
oops………. better just go to the coin shop and buy some gold…….. 🙂
By Kristine Owram and Claire Ballentine
Bloomberg News
Wednesday, March 23, 2022
Gold exchange-traded funds are one of this years hottest investments, with war, inflation and stock-market volatility sending people scrambling for safe havens. But those buying physical gold ETFs may face an unexpected tax burden.
Funds that invest in precious metals like gold and silver are treated like collectibles for U.S. tax purposes, meaning long-term capital gains from those funds will be taxed at a top rate of 28%, compared with a maximum rate of 20% for stocks.
Or start a sugar smuggling operation into Russia. 😏
humm…….. interesting…… 🙂
Hi Mathew..Daily Boil…any impression?
Hi Larry, I’m bullish but wonder if it will fill yesterday’s gap.
https://stockcharts.com/h-sc/ui?s=BOIL&p=D&yr=1&mn=5&dy=0&id=p56179439487&a=1065538381
It is probably in for a long move up.
https://stockcharts.com/h-sc/ui?s=BOIL&p=W&yr=3&mn=11&dy=0&id=p45780190510&a=1065572127
The Fibonacci fan resistance that capped it in October now comes in around 57 instead of 80+
https://stockcharts.com/h-sc/ui?s=BOIL&p=W&yr=3&mn=11&dy=0&id=p43737683007&a=1090657068
/NG daily underlying….
Looks like we should have just bit the bullet on Petrus Ex and paid the price. Outperforming Gasx at this point
Yep, Petrus is up bigly again today Wolfster. The personal decision for me was to pick names that hadn’t popped as much or that had rallies proceeded by corrections for getting positions in place – (like my recent adds of NG Energy, CGX, and Riley Exploration) .
There were just so many oil & gas companies that were already at such high levels by March, that I didn’t want to chase them higher, whether that be Petrus Resources, Hemisphere Energy, or InPlay Oil, etc… If some of those high flyers have a solid corrective move, then I’d be more interested in getting positions started in them.
Hey larry………… miss you over at the ORPHAN SECTION……. 🙂
Jerry…..Only one commentator makes sense…..JM…I just got sick of parading out the 99% retail conforming untruthful docs ….. like forever liars…
Sorry larry……… JM….. is a little behind the curve……. 321 had a great piece , I posted, which is another clue,… why , some think he is a little off base.
Democracy…. humm…… just another way for the sheeple to get fleeced….
Should add…….. I do like his thoughts…….. on some things…
I know Jerry…. I read all your links as well as the rest…good stuff…I still like the way JM analyzes and connects dots…the environment is fluid as they say…Thanks for your friendship…glta
larry,……… thanks for the reply……… appreciate your thoughts….. and thanks for your friendship. as well,… stay safe….
scary dangerous gdx volume today has 9.5 million so far….testing 3/21 w 25 million…where are the buyers up here….have the sellers distributed?…no hate mail please….A minor pullback in the scope of what lies ahead…i have been screwing w Boil too much and missed my entry on this leg up clearly revealed on 2/11/22 breakout bar…glta
tonight is JOBY quarterly earnings release…they have contracts secured for future revenue….
GDX:GLD just had its best close in 196 sessions.
https://stockcharts.com/h-sc/ui?s=GDX%3AGLD&p=D&yr=1&mn=1&dy=0&id=p37171453841&a=1098305492
GDX:SPY looks ready to rise again.
https://stockcharts.com/h-sc/ui?s=GDX%3ASPY&p=D&yr=1&mn=11&dy=0&id=p38939238037&a=1114123550
This will probably be the week that GDX gets confirmed by GDX:GLD.
https://stockcharts.com/h-sc/ui?s=GDX%3AGLD&p=W&yr=2&mn=7&dy=0&id=p74959874530&a=1123399783
I found this to be quite telling:
Stephanie Pomboy: Friend just flagged that AAPL has added $300 billion in market cap since 3/14. That is nearly equal to the $336b market cap of the entire XAU Index of gold & silver miners. The problem of ‘too small’ market cap to be investable is going to solve itself rather quickly I suspect.
All That Glitters Is Not Necessarily Russian Gold
Pepe Escobar – The Untz • MARCH 17, 2022
The “rules-based international order” – as in “our way or the highway” – is unraveling much faster than anyone could have predicted.
“The Eurasia Economic Union (EAEU) and China are starting to design a new monetary and financial system bypassing the U.S. dollar, supervised by Sergei Glazyev and intended to compete with the Bretton Woods system…”
https://www.unz.com/pescobar/all-that-glitters-is-not-necessarily-russian-gold/