Jordan Roy-Byrne, CMT, MFTA, Editor and Publisher of The Daily Gold, and author of the book “Gold & Silver – The Greatest Bull Market Has Begun – A Once In A Lifetime Investment Opportunity”, joins us to review his medium-term technical outlook for gold, silver, and the PM stocks, the cartoonish cashflow being generated by precious metals producers, and the search for “holy grail” and “unicorn” resource stocks with catalysts for value creation.
Key topics discussed:
After completing the logarithmic extension of the longer-term 13-year cup and handle pattern breakout in gold, and making it all they way up to $4,398 gold has corrected some this week pulling back down near the $4,000-$4,100 level.
- We ask Jordan if this the beginning of a more meaningful corrective move, or if there are still higher levels in store for the yellow metal in the near future?
- Jordan sees first support at $3,950, and more meaningful support down in the $3,600-$3,700 range.
Jordan believes we may have seen an interim top in the precious metals equities, as many of them and their ETFs have “rhino-horned” in steep inclines higher in share price on the charts.
- Despite these recent big down days in the gold and silver stocks, he is still looking at acquiring the best quality stocks with the most torque into any pullbacks.
- We discuss the “cartoonish cashflow” being generated by gold and silver producers at current metals prices, and look ahead to what should be record revenues in Q3 earnings reports.
- Investors need to look at things on a company by company basis, analyzing for quality projects and management teams that can add value in any price scenario.
With regards to silver, it just had a very strong breakout move to new all-time highs in the $53-$54 region. While it has come off these recent highs down to around $48, he still sees a scenario where silver could essentially double in the next 6-10 months to triple digits.
- Initial support for silver is down at $46, with next support at $42-$43, and deep support at $41.
- Jordan is watching to see how silver interacts with the 150 day moving average, which has been significant in past cycles.
Overall, Jordan does not believe this is the top or end of the precious metals bull market.
- We have not seen a rollover in general US equities where all the capital floods into the PM sector.
- We have not seen gold or gold equities get to a high enough multiple of US equities like the S&P 500 or Dow, as they have in all prior cycles.
- If anything this is simply the end of the beginning of the cyclical bull, within the larger secular bull.
Jordan expands on the PM stocks that he likes most, and why he’s positioned in developers and producers in his portfolio that have catalyst driven growth and value creation.
- We discussed “holy grail” gold and silver producers that can both grow their production profile operationally at the same time as agressively growing resources through exploration.
- We discussed “unicorn” PM stocks, which are either developers or producers that can either finance and build a new mine that still has expansion potential, (and that expansion pays off part of the capex); or companies that can actually build multiple mines in a cycle.
- He is seeing big value in the developers with defined ounces in the ground and improving economic studies based on the higher metals prices; but that also have management teams and boards that can actually raise the capital and build the mine.
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This content is for informational and educational purposes only and does not constitute investment advice, an offer, or a solicitation to buy or sell any security. Investing in equities and commodities involves risk, including the possible loss of principal. Do your own research and consult a licensed financial advisor before making any investment decisions. Guests and hosts may own shares in companies mentioned.
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