Buster… love the name.. congrats

Hi DT. Sure I’d be happy to share my perspectives and my thesis and how I’m positioning for what seems most probable to come moving forward.

Just a quick point, the purpose of that article was to point out that I was bullish on the PMs in real time as it was happening (not just looking backwards). There have been so many interviews where I brought up over and over again, the importance of the breakout in gold after the solid November close and new ATH tagged on Dec 1st; and even more important how significant it was technically that we saw the highest monthly, quarterly, and annual close on Dec 29th in gold ever…. in history. I must have asked guests about that in 2 dozen interview now over the last few months.

I pointed out repeatedly in interviews (and even had a lot of interesting exchanges with our show guests off mic before recording many days) on how that ALREADY indicated the next leg of the bull market was on, long before we saw this most recent breakout over the last 2 weeks. Rarely did I get any buy-in or that much agreement from our guests or other technicians on this point, as they were so weighed down in sentiment due to the mining stocks, but again, that doesn’t have anything to do with Gold’s journey or chart. They’d acknowledge those had happened, but failed to agree it was showing a gold breakout underway, and that never made any sense to me… because that is a clear bullish breakout signal any way one slices it on the more important major charts. I said over and over again that it was only a matter of time before nominal prices broke out in earnest because the breakout on the monthly, quarterly, and annual charts were the bullish signal that we’d been waiting to see.

Often it was very frustrating and also flat out confusing to me that people that were chart technicians, (that often gave a lot of lip service to the longer duration charts), were not recognizing the importance of breakouts on the gold monthly, quarterly, and annual charts, or the highest annual average pricing in both 2022 and 2023.

Some of the guests we had on the show were still claiming we were in a bear market in gold (What??) and it just seemed nuts to me; as gold kept knocking and knocking on the highs. That is not bearish action in the slightest. Then eventually a few months ago, Gold had already broken out on that Friday Dec 1st, and then followed it up on Dec 29th with across the board all-time highs on all the major charts. What could be more bullish than that?

Gold had never come anywhere close to testing it’s major lows and was not consistently making new lows which is what is required for a bear market. All of the action was bullish, bullish, bullish, and I was just stunned that so many people failed to see it. (trust me there were a few heated debates about it as it was happening, right after it happened, and since it happened, and many people I respect were very wrong-footed about how this whole thing has played out).

Sure the PM mining stocks were in a bearish pattern overall the last few years, (still with a number of strong tradable countertrend rallies that could have been capitalized on as pointed out in real time…), but still the overall trend since August of 2020 has been down in the broader gold equities. Having said that, just because the gold equities were correcting, didn’t have anything to do with the trajectory and chart pattern for gold. They don’t always correlate (as seen by the huge disconnect in the patterns for gold vs gold equities the last few years). The point is gold has been strong, and been trying to break out, and I’ve noted that the whole way along, and have been consistent on that for years now.

Heck there wasn’t even that much downside pressure on gold the last few years years, other than the bear trap period in Sept-Nov of 2022 where it briefly dipped below $1675 to $1618. Yes, that move made me nervous as it was setting up, like it should have made anyone nervous following the charts and seeing major support break. However, when Silver rocketed out of it’s low of $17.40 in early September, and then the GDX/GDXJ rocketed out of their lows in late September, I knew Gold would eventually reverse, and it did later after the Nov 4th low. I had all those exchanges with ole’ Joe on here stating just that, as it was playing out in real time. I am also on record in a number of interviews in Oct/Nov/Dec of 2022 pointing out that the bull market was back on and that it was a bear trap… and it absolutely was. So this not just cherry picking in hindsight, and I tried my best to offer some foresight as it was playing out.

With Gold: All of the pressure has been to the upside where it kept popping above $2000 and testing the upper limit. It was only a matter of time before it broke through. I considered the merits of the double top (2020 + 2022), but then when it kept retesting in 2023, I though the whole triple top narrative was silly and stated, while anything is possible, it sure didn’t seem probable. I mentioned what seemed more probable was gold breaking up through to new highs in 2024, and here we are….

This recent blast higher in gold to me was already well baked into the cake, and is not surprising in the slightest. In full transparently, I did think it may take a little bit longer to arrive (post summer doldrums), but never doubted we’d see new highs this year. It doesn’t seem to matter much that gold broke out regardes, as this surge higher has not garnered much interest or enthusiasm in the financial marketplace. (likely because so many other sectors like general equities and cryptos have also breaking out to new highs in tandem). Still it nice to see the follow through from the other signals already noted previously as precursors.

Now onto the present set up: I mentioned in the article that gold’s RSI was now at 80.44 so it is in overbought territory. It could stay overbought for a while longer, but really a corrective pullback to consolidate some of the recent gains in the next week(s) would seem rational, and allow the chart indicators some space to cool their jets. After that pullback though, as discussed in both the recent interview with Christopher Aaron and Dave Erfle, it seems to me that whatever pullback we get will be the last place to accumulate the mining stocks on the cheap before the whole sector really starts to break out and gather some momentum.

What I’ve asked of so many of our guests pundits and technicians on the show is when Silver is going to get on the move, because that is far more germane for bigger moves higher in GDX and the PM miners than gold’s breakout. I do believe when gold moves up to that $2,535 rectangular box consolidation extending the amplitude higher (or for those into the cup & handles the smaller C&H pattern target also around $2500) that it will drag silver higher to test resistance at $26, $28, and eventually the more important $30 level. I’ve stated repeatedly for 2+ years that once silver can break $30 that there is very little resistance above it (maybe a little at $35-$36), the round psychological $40 handle, and then ultimate resistance at $49 (the level it hit in 1980 and again in 2011).

If we see silver break $26 and $28, in tandem with gold continuing to truck higher, it will get the PM stocks, moving, but when Silver breaks $30, that is the trigger I’m looking for to really get both the gold and silver stocks rocketing higher in valuations. To me Silver is more important to watch for the mining stocks than Gold, but obviously, a higher price in the yellow metal is great for producers margins, and the economics of development-stage projects and will help those gold company valuations as it rises.

My thesis is that if Gold can get up above $2300 and stay there, silver can break $28 and retest $30 resistance. I also believe that if gold can break above $2300 and head towards $2500+ that silver will eventually break $30 and quickly move to $35+. That is when I believe we’ll see very euphoric sentiment peaking in the PM sector, and believe this will happen by 2025. (I’m not ruling out that it could happen later this year if we saw some kind of banking crisis surface or a wild geopolitical event unfold). Based on the pace we are going though, I think this year will be good, but that 2025 will be the euphoria year for gold, silver, and the PM stocks. That’s my outlook, and has been my outlook for a while now… It just needs time to play out.

Barrick is going to perform exceptionally well in my opinion. It is in vastly better shape today than in 2011/12 when gold hit 1900+ for the first time. It makes perfect sense that AEM has outperformed lately and over the last 18 months but significantly higher gold will be better for Barrick than for AEM. That is, it will disproportionately impact Barrick’s bottom line.
https://stockcharts.com/h-sc/ui?s=GOLD&p=W&yr=4&mn=8&dy=0&id=p51133966013&a=1626458718

Put the above “insider” thoughts in terms of another mechanism of “transfer of wealth” and the additional possibility of an alternative agenda to that of the Man on the Street.

I’ve been waiting for the miners to start lifting the index instead of being the weight holding it down, haha… thanks for the many charts again.