TG Watkins – Waiting For A Capitulation Event, An Analog To 2008 and Bonds Performance Compared To Equities

October 24, 2022

TG Watkins, Director of Stocks at Simpler Trading brought a couple very interesting charts to today’s discussion all tying the possibility of a capitulation event in the stock markets to real times data and what happened back in 2008. Follow along on the charts below to see why he thinks a big move down is coming for the markets and how news and data is lining up to support this.


S&P in 2008
    Oct 24, 2022 24:30 PM

    Some up and some down and some not reported correctly.

    Oct 24, 2022 24:08 PM

    H&S on daily silver chart. If $18 (the neckline) gets broken, the pattern projects down to $15.

      Oct 24, 2022 24:18 PM


      with all do respect evey time you speak it sounds like a wanted bearish tone lol.. As i mentioned before i was thankful for your views weeks or a month back but we are totally reading charts differently and that means one of us will be big time wrong..

      Since we last spoke you had such a bearish tone for brixton metals hoping and wanting to purchase much lower when i mentioned charts said higher. Here we are again and soon brixton will hit those targets my charts and work have noted from time yet you remain bearish no comprendo amigo.

      .15 held like a rock and nothing is ever out of the question, but there is a high probability in my books that .15 may never be broken again. i now see .25-.27 next on the attack. i bet matthew possibly sees the same and im talking in short order.


        Oct 25, 2022 25:24 AM

        It’s just a chart formation. Take it FWIW.

        I am bullish long term, but in the near term, anything can happen. I wouldn’t be shocked if the mining stocks dropped 25% in a week and then reversed (similar to what they did in 2016). Or maybe it’s just a marginal lower low. Finally, I am not foreclosing a move higher from here. Again, I think anything can happen around these major inflection points, and the pain often but not always becomes acute for a month before reversing. I am watching PAAS for a clear sign that the worst is over, which for me would be as little as a weekly close above the 20 WMA. I think it’s quite possible that it tags its lower weekly BB and makes a marginal new low sometime in the next month or two before moving higher.

        Cyclists will also note that gold’s daily cycle appears to be left translated (made a lower low) and there is likely another 2-3 weeks left in the cycle which means plenty of time for a lower low.

    Oct 24, 2022 24:10 PM

    Thank you for that interview…..I went to the company’s website…Plenty of free info. to get familiar with…Also, they seem to have proprietary indicators…not sure…anyways, thanks much as usual…
    I will give feedback after a while…Not sure how they work it…glta

    Oct 24, 2022 24:07 PM

    Pure Gold Mining took a nugget out of me today

      Oct 24, 2022 24:13 PM

      Sorry to hear. Just another pump and dump gold dreg.
      I remember the jubilation a month ago with pgm here.

        Oct 25, 2022 25:34 PM

        Pure Gold was a producing mine, not a pump and dump, and Mark O’Dea had taken over as the CEO and he has been successful in selling producing and development companies in the past, and was making the rounds doing interviews discussing their improved mining strategy, throughput, and ounces produced. He was also buying in the open market with his own money, which is typically a good sign from an insider. The stock did rally on the back of all that for a few months, but their news out is that they have a funding shortfall, didn’t get the warrants exercised that they expected to bring in, and now have an insolvency concern and possible bankruptcy issue, which was not messaged in all their recent interviews.

        That is different than the proverbial pump and dump on a hot drill play that sucks in unknowing retail investors and then the promoters sell into the frenzy before a return trip back down on some sketchy bit of moose pasture. Pure Gold was operating the old Madsen mine in Red Lake, right next to the Red Lake Mine (previously of Goldcorp fame and now with Evolution Minning) and on the other side was Great Bear Mining, the #1 exploration success to takeout story of the last few years.

        Now, after this week I guess PGM does qualify as a “dreg” and the miscommunication from both management teams over the last 2 years has been abysmal. I did very well from 2018 into first gold pour in December 2020, selling out for a nice win. The mistakes I made were getting back in in 2021 and then again recently in 2022 (although I did have a nice 30% swing trade in it back in early September).

        The utter collapse on Monday did wipe out all the gains and became a tax loss for me this year, but I had other good years trading PGM, so overall it was a net win, over the years, but I hate to see it go out like it did this week, and it is going to leave a very bad taste in many investors mouths regarding the Oxygen Capital group and Mark O’Dea and the prior CEO and president Darin Labrenz, which is unfortunate as I like both those guys personally.

    Oct 25, 2022 25:08 AM

    Trend Strength:
    NatGas Bottomed. Golden C Soon?
    Dollar Decline For PMs?

    Oct 25, 2022 25:38 AM

    The US needs an Ulf…
    “New Prime Minister Ulf Kristersson is not heeding to the Green agenda. He promptly eliminated the entire Ministry of Climate and Environment, marking the first time in 35 years that Sweden does not have a specific climate ministry. People are crying that the world will crumble without funding bureaucrats who pretend they have the ability to alter the weather cycle with enough funding.”

      Oct 25, 2022 25:04 AM


    Oct 25, 2022 25:09 AM

    will this trigger more price action in /NG?…..NO

    Oct 25, 2022 25:38 AM

    When it rains it pours, now Calibre Mining, yesterday Pure Gold, and last week Superior Gold, lots of landmines these days. DT

      Oct 25, 2022 25:14 PM

      Yep. Calibre and Mako fell due to the US sanctions on Nicaragua that were just announced. I reduced down my Calibre position yesterday, but clearly not enough. I’m still confused on how US sanctions affect Canadian companies?

      Pure Gold put out a sucker punch news release that they are $13 million in the hole, are not going to get any warrants exercised, and have a funding issue / potential of going bankrupt. ( I sold on that news)

      Superior Gold, got sick of their 3rd party mining contractor vastly underperforming guidance, so they fired that whole company, and had to do a $10 bridge loan as they put on care & maintenance for 6 months. I sold it for a tax loss, even though I still like the company.

      Mining…. it’s a tough business.

      What’s next Nevada halts all mining? Good grief!

    Oct 25, 2022 25:29 AM

    Defiance Silver getting hammered on a news day…

        Oct 25, 2022 25:01 AM

        Added some Defiance after it got hit -15%. Also picked up 25,000 shs of Pure Gold. Who knows. they still have a lot of gold in the ground…maybe somebody wants gold other than Central Bankers.

          Oct 25, 2022 25:09 AM

          This is the lowest price since shortly after the March ’20 lows.

            Oct 25, 2022 25:16 PM

            Apparently the online influencer “Gold Ventures” sold his Defiance, and so his throngs of followers have been doing the same the last few days.

            I thought the drill results were just fine, and it didn’t really make sense to see all the selling until I saw all the scuttlebutt on GV selling.

            I’ve only just recently started a position in back in DEF, but if it keeps cratering, I’ll add a second tranche, and possibly a third tranche.

            Oct 25, 2022 25:19 PM

            Thanks for that heads up, I rotated a bit more into it today too, haha.

          Oct 25, 2022 25:32 PM

          should have waited for lower prices on pgm lake

            Oct 25, 2022 25:58 PM

            I think I paid around .016 for the 25000. ($400). Will see. I had previously held it during the Great Bear years thinking that area would catch on. Great Bear did.
            Picked up Mako around .10 cents. Also Big Ridge under .10.

            Oct 25, 2022 25:23 PM

            Lakedweller2, you have more courage than I do buying PGM down here. I sold when the news broke about their financing trouble on Monday. It is possible that they find a way to finance things, but it will likely be very dilutive to existing shareholders…. Unless it is a takeover by a larger company. Still, they are far too close to a potential insolvency / bankruptcy outcome for my risk tolerance appetite.

            I hope you win big taking the contrarian bet though, and we should know in the next few weeks if a white knight is riding in to bail them out. It looks pretty ugly though.

            Oct 25, 2022 25:24 PM

            Yeah… they have over 700k shares out and debt problems. They are going to be prime for a reverse split. I will probably end up getting interested in something else and roll it out… but just in case we have a freak day when the interventioners are beating their kids instead of suppressing prices, I will be ready.

    Oct 25, 2022 25:42 AM

    Dollar down and some body wants metals to capitulate. I got a call from my overseer at Schwab but I didn’t answer as it is never any assistance. Very strange goings on today. Unwarranted attack on metals and gives every indication of being orchestrated by persons not operating in the best interests of retail.

    Oct 25, 2022 25:07 PM

    PGM and AXU are 2 good examples of the risks that come with development stage and newly producing companies. I exited both completely years ago without knowing that either of them would run into such trouble because the risk/reward picture of any development company is rarely good enough.

      Oct 25, 2022 25:41 PM

      There are plenty of risks that also come with exploration stories or even established producers, and plenty of examples of companies that have also been destroyed over the last few years in those stages of the business, and conversely there are also plenty of examples of development stage companies moving towards production and into production that did quite well and outperformed the pack, so the takeaway is the mining business is risky at all phases and there isn’t a safe place without risk.

    Oct 25, 2022 25:02 PM

    Yes, exploration stocks come with plenty of their own risks but I couldn’t disagree more with the aim of your takeaway. The risks are not even close to the same as you imply. There’s simply no comparison which is why I have never had a single explorer come close to going bankrupt. Volatility or price risk is nothing compared to bankruptcy risk.
    I made big gains with AXU and even PGM when their risk of bankruptcy was nil. Holding through the development stage is nuts in my opinion with few exceptions.

      Oct 25, 2022 25:58 PM

      Well to each their own, but there are plenty of risks to each phase of the mining cycle, and we’ve seen plenty of carnage in the explorers, developers, and producers for different reasons.

      I made great returns in both PGM and AXU during their golden runway phase as a developers continuing to explore and derisk their projects moving towards first pour. Some of the better success stories in the PMs over the last few years came as companies moved from developers into new producers — like K92 Mining, Wesdome, or Atlantic Gold before they got acquired a year after going into production. Look at the huge success of Orezone, or Silvercrest, or Guanajuato Silver, or Minera Alamos the last few years as they went from developers to producers. Those again are some of the better names in the sector, so I wouldn’t agree with your takeaway on completely avoiding developers or new producers either, and only pointing to the ones that struggled. Yes, new producers have plenty of risks and some do fail to get escape velocity, but some also do a good job. We’ve covered Guanajuato Silver, Silvercrest, Minera Alamos, and Thor Explorations as they graduated from developers to producers, and they’ve done a fantastic job in a very tough market.

      We’ve also seen huge implosions in more established producers that weren’t any less risky. Look what we just saw happen the last 2 years to Argonaut, or Iamgold, or Americas Gold & Silver, or McEwen Mining, or Great Panther, or TMAC, or Guyana Goldfield. Look at what we just saw this week from two very solid producers Calibre and Mako due to the Biden administration sanctioning Nicaragua out of nowhere, which had nothing to do with their operational success. Look what we saw happen in the past to producers like Primero, or Crocodile, or Luna / Trek, or Rubicon, Richmond, or Klondex where they couldn’t keep growing and larger companies got predatory and took them out to put them out of their misery. Even established producers can still have a host of risks and challenges, so again, each stage of the mining cycle has plenty of risks.

      As for explorers they are chock full of execution, exploration, dilution, social, and jurisdiction risk and there are hundreds of skeleton companies discarded along the roadside and plenty of disgruntled bagholders that went all in on stories that blew up their investments on explorers due to hot tips and promotion pumps devoid of reality. Currently most explorers are down 70%-90% from their highs 2 years ago. Even the explorers with millions of ounces in the ground have been decimated, so they are extremely risky. They are not revenue producing companies so yes they rarely go bankrupt, but that is because they are dilution machines (perpetually staving off bankruptcy by blowing out even more shares). Personally, I see the explorers as the riskiest group and they can absolutely still destroy ones investment capital investing in these pre-revenue drill plays.

      Look, 99% of explorers will never have an economic deposit that gets bought by a larger company or that actually makes it into production… so most are lifestyle companies or pipe dreams, and will never become valid revenue producing companies. One can minimize their risks through good teams that have sold projects before, but even then good teams fail to achieve in exploration all the time.

        Oct 26, 2022 26:42 AM

        That’s a mighty defensive response that simply doesn’t hold up. You should consider politics; you’d make a killing.

          Oct 26, 2022 26:51 AM

          There was nothing defensive about it, and your response that it simply doesn’t hold up is your subjective take on it, but you didn’t counter any of the many points I just made.

          You disagreed with my premise, and I disagreed with your premise – which is totally fine. I provided plenty of examples unpacking and demonstrating the risks in all stages of mining, provided plenty of legit company examples, and also pointed out that some of the biggest winners and quality companies the last few years were developers moving into production. I also pointed out that there are a multitude of risks with explorers and they are every bit as risky, if not more so than developers, and pointed out why using the bankruptcy risk for developers & producers but not explorers doesn’t add up, as they simply perpetually dilute down investors and blow out share counts to keep their lights on… which repeatedly destroys investors capital invested.

          I also didn’t make personal insults towards you in the process (which is what your politics quip was).

          Let’s just move on…

            Oct 26, 2022 26:25 AM

            Ex, if you think the risk/reward that comes with development plays is on par with that of a well-chosen explorer you probably shouldn’t be running your own money. Development comes with far more potentially devastating risks that even the best analysts can’t shield you from. That’s just a fact, your prolixity notwithstanding.
            Yes, let’s just move on.

    Oct 25, 2022 25:40 PM

    Relax out there, Lake took a flyer with 400 bucks LOL

      Oct 26, 2022 26:00 AM

      Some people smoke, some people drink

        Oct 26, 2022 26:51 AM

        Potential double at over .03. But, my best performers have been Go Metals, Midnight Sun and Africa Oil. Go figure.

          Oct 26, 2022 26:48 AM

          That would be a 50% gain on the 400 bucks. Not a bad return on that pgm flyer.
          Like pointed out here, the penny arcade has it’s benefits LOL for those moonshots ???
          After all look at brixton. But then there’s calibre, superior and a host of others.