Craig Hemke – Gold’s $60 Pullback; Geopolitics or Something More?

April 22, 2024

Craig Hemke, Founder and Editor of TF Metals Report joins us to comment on the pullback in gold and silver today. Is it geopolitical fears subsiding, the start of a natural correction, or something more?


We also discuss how the precious metals stocks continue to largely disappoint. Craig points to silver and copper needed to establish higher price levels to bring in investors.



Click here to visit the TF Metals report website.

      Apr 22, 2024 22:43 PM

      RRule says it only has small deposit and he’s not interested

        Apr 22, 2024 22:45 PM

        Energy Fuels has a number of prior junior’s flagship projects rolled up into it’s asset base (it’s acquired about a half dozen companies over the last dozen years). In that sense they aren’t that small of deposits (but not huge like Fission or NexGen that RR likes better). Energy Fuels projects are also not high grade, like in Canada, and their production profile is small, so I could see where that wouldn’t interest someone like Rick. However, they are economic producers that can flex production up or down based on where U308 prices are which animates many retail investors (including me). Energy Fuels doesn’t have to be in that high of grade or that big of a production profile as a US insitu producer. Not to mention… with these high metals prices, they don’t even have to be that high of grade on their hard rock traditional mining development projects (which they aren’t, but they’ve got a number of them in their pipeline of projects).

        UUUU has been a producer in this cycle, and in addition to uranium, also produces vanadium, and is just starting to process rare earths, so it has 2 other commodity kickers for revenue generation. It is going to see how they grow the rare earths side of the business, and are one of the few companies that are going to actually produce REEs, whereas the vast majority of rare earth companies are full of hot air and never got close to producing a useable product at commercial scale.

        I will say, as a current Energy Fuels shareholder, that I’ve not yet really digested this new mineral sands business from Base Resources in Kenya, but it appears they are looking to process the REEs from the monazite and further beef up that side of the business.

        In contrast to the smaller and lower-grade Energy Fuels that will at least produce metals in this uranium cycle, the vast majority of the high-grade U308 deposits in Canada (which more investors seem animated by simply based on the zestier grades) are nowhere close to making it into production in this uranium cycle, and many will never get developed or extracted.

        At least one can say that a lot of the smaller US producers like Energy Fuels, Ur-Energy, Peninsula Energy, enCore Energy, (and soon to be Uranium Energy Corp), can start generating income with these prices, and enter into contracting agreements with utility companies, to trim down the need for dilutive financings. That optionality and ability to generate revenues is refreshing in a universe of smaller drill plays perpetually raising money and blowing it drilling out deposits that have very small odds of ever contributing to power generation.

        Personally, I’ve done quite well trading in and out of a lot of the smaller dual-listed US companies over the years, and find them to be much more liquid than most of the smaller Canadian juniors, and have done quite well the last 4 years, and especially over the last year. There are also a few dual-listed and more liquid advanced Canadian projects like NexGen and Denison that are also good for trading.

    Apr 22, 2024 22:44 PM

    Gold going down today was a natural and welcome correction. DT

    Apr 22, 2024 22:29 PM
    April : Gold & Silver
    GDXU Target

    Apr 22, 2024 22:27 PM

    Gary Wagner – Gold’s Sharp Selloff — Shallow Correction or Major Trend Reversal?

    Kitco News – Apr 22, 2024 – Charts Gold, Silver

    00:00 – Introduction
    00:56 – Geopolitical Impacts on Precious Metals
    01:22 – Analyzing Recent Price Declines
    01:59 – Market Corrections Explained
    02:23 – Impact of Geopolitical Tensions Easing
    03:19 – Technical Analysis and Future Predictions
    04:17 – Influence of the Federal Reserve
    07:15 – Understanding Market Movements
    16:12 – Conclusion and Final Thoughts

    Apr 23, 2024 23:19 AM

    These are the top 10 holdings in GDX that make up 60% of the total ETF:

    NEM US Newmont Corp 11.47
    AEM US Agnico Eagle Mines Ltd 8.10
    GOLD US Barrick Gold Corp 7.65
    WPM US Wheaton Precious Metals Corp 6.08
    FNV US Franco-Nevada Corp 5.95
    GFI US Gold Fields Ltd 5.03
    2899 HK Zijin Mining Group Co Ltd 4.75
    NST AU Northern Star Resources Ltd 4.12
    AU US Anglogold Ashanti Plc 3.94
    KGC US Kinross Gold Corp 3.28

    It is just an interesting thought that the GDX is regularly used as a barometer for the overall health of the gold equities, but really 60% of this index is merely the health of 10 of the larger cap major mining companies (which include 2 royalty and streaming companies). Franco Nevada only has 64% of revenues actually from gold, with the balance 1/3 being from silver, oil, platinum, copper, and nat gas… even though it reports in gold equivalent ounces.

    There are over a thousand gold mining stocks across multiple exchanges, and so very many mid-tier producers, smaller producers, developers, advanced explorers, grassroots explorers, prospect generators, and royalty companies that are often moving quite differently any given day, week, month… than the GDX (again, mostly weighted to just those 10 large cap companies aforementioned).

    Now think about recent situations like when Newmont acquired Newcrest and was sold down hard on this transaction, or the Cobre Panama mine closing which was projected to represent 20% of Franco Nevada’s 2023 revenues and a $1.7Billion impairment charge was incurred on it. That meant 2 of the 10 stocks were beat up, because of unique micro fundamental pressures, that had nothing to do with most other gold companies, but those effected the performance of the GDX.

    Granted there were companies like Agnico Eagle, Kinross, Gold Fields, and Wheaton PMs that did exceptionally well over the last year that balanced out the underperformance of Newmont, Barrick, and Franco-Nevada. I guess in that sense, the ETF works to smooth out the noise with a basket approach, but then again, it can be a wildly different experience for some investors individual portfolios versus this specific basket of majors (for better or for worse).

    It’s just curious to consider how the movement of just a few larger cap gold stocks (that very few junior speculators actually own) can effect the sentiment of so many traders of the gold junior equities.

      Apr 23, 2024 23:38 AM

      Out of all the 59 GDX holdings, I only hold positions in 7 of them and they are companies weighted much lower in the batting order, and not significant contributors to the overall ETF valuation.
      (In my portfolio there is only 1 stock even in the top 20 holdings of GDX, and it is #20 Hecla Mining).

      It’s just interesting how much focus the sector gives to GDX, when it’s results likely differ quite a bit from most investors individual mining stock portfolios, especially when so many have baskets of mostly juniors.

        Apr 23, 2024 23:34 PM

        The Magnificent 7 is consistent with the managed money concentration in the GDX. The purpose of intervention is to offset in some degree the risk Wall Street takes with derivatives. If there was a level playing field, the performance of miners would be more level across-the-board. Greed with advantage is a difficult thing to control when you also have the ability to alter outcomes.
        Trading in miners during the 2001 to 2008 crash was a good example of miners trading in tandem. Normally when gold/silver had a decent day like a + 20 or so gain in gold, most all miners responded positively. When a miner had a good news release, the price reacted accordingly. That ended with JP Morgan taking the silver trading after Bear Starnes take down.