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Oil Outlook and A Technical Factor To Watch For PM Stocks

Cory
February 26, 2018

Doc is with us today to share some comments on the recent run in oil. The possibility of a breakout is there but Doc thinks we will see another pullback at the recent peak. As for metals stocks we share one technical factor that we are watching closely on all stocks. Listen in a refer to the Excellon chart below.

Click download link to listen on this device: Download Show

Discussion
43 Comments
    Feb 26, 2018 26:59 AM

    Doc can you recomend some gold stocks i can buy and hold for the breakout next 3 years, I hold Auryn Res, Endeavor, McEwen and Great Panther now. Thanks

      Feb 26, 2018 26:54 AM

      Paul, 2 of the many stocks I hold are 2 of them you mentioned—-Endeavor and McEwen. I am waiting on AUG since I sold it at much higher levels—I will purchase it in the future again. I like GG which I sold recently and it’s coming back to me again. I think over the next few weeks GG could challenge the 10-11 area. I will be a purchaser then. If it looks like it won’t go lower technically in the near future, I’ll try to get back into that one at 12. I’m also going to add to AUY as it comes back again. I’ll purchase by watching the monthly chart as it moves back toward the lower BB. Also, I’m getting close to purchasing NGD. They’re earnings came out recently and the PEd is not rich on this one. I’m waiting to pull the trigger on that. Since I feel gold is topping I feel these stocks will be under a little pressure yet in the weeks ahead as we move toward May.

        Feb 26, 2018 26:48 PM

        I hold Endeavour Silver and McEwen as well, and they’ll do just fine in a resurging bull market, and will outperform many of their Mid-tier peers.

          Feb 26, 2018 26:56 PM

          Endeavour Silver Updates Development Progress and Improves Operating Metrics of the El Compas Gold-Silver Mine Project in Zacatecas, Mexico
          February 20, 2018

          http://www.edrsilver.com/news/2018/index.php?content_id=618

          Feb 26, 2018 26:01 PM

          Ex, I agree.

            Feb 26, 2018 26:20 PM

            In addition I respect both Brad and Rob as CEOs, and feel the pipeline of projects at both EXK and MUX are under-valued and underestimated by the marketplace.

            Later in 2018 and moving into 2019 I expect both to be large movers on a percentage basis.

          Feb 26, 2018 26:13 PM

          I hold Irving Resources, thanks Bob M. This is my only position in gold exploration stocks, I have a few silver producers as well. Anything else I buy will not be a hold but a trade. DT

      Feb 26, 2018 26:10 PM

      Paul, another stock you might watch carefully is HMY. I purchased them recently when the weekly BBs narrowed significantly. Sure enough, the stock bumped up after their earnings came out. I think they have a PE close to 5. They’re right at resistance of their 200 week SMA. I’m hoping they’ll move back one more time to fill a gap at about $1.85 and then I add some more.

    GH
    Feb 26, 2018 26:10 AM

    Can anyone explain how it is that almost every market is green today? In my simple mind, one thing goes up, another goes down…

    https://finviz.com/futures.ashx

      Feb 26, 2018 26:22 AM

      I don’t know about one day, but when that happens over time, it’s due to inflation (of the money supply).

    Sam
    Feb 26, 2018 26:30 AM

    Doc in reference to you podcast today on the 200wk SMA you said you like GG in a previous podcast but GG is trading below a downsloping 200 week SMA. Is there another reason to hold GG? Thanks

      Feb 26, 2018 26:59 AM

      I sold my GG recently and an waiting to purchase it back. Their PE (trailing) is about 15 and they’re one major that is not seeing dwindling assets. I love the monthly chart and I think I might be able to pick up shares again in the !! dollar range as we move deeper into the spring. Sam, remind me every 3 weeks to respond to you on this one and I’ll let you know when I purchase.

        Sam
        Feb 26, 2018 26:45 PM

        Thanks Doc I will. I own but wrote covered calls figuring it wasn’t going anywhere fast.

          Feb 26, 2018 26:02 PM

          Good for you, I think you will do fine. Just keep writing those calls but don’t get stopped out and then watch the stock get away from you—should be no problem for the foreseeable future.

    Feb 26, 2018 26:17 PM

    It will be interesting to see if Excellon reaches this P&F target of $1.30:

    http://stockcharts.com/freecharts/pnf.php?c=exn.to,PWAADANRRO%5BPA%5D%5BD%5D%5BF1!3!1.0!!2!20]&listNum=5

      Feb 26, 2018 26:51 PM

      I’ve never understood point & figure charts. They’re just an eyesore to me, but I see that target in Red (but have no clue how it is derived).

      Excellon had some good news out this morning though:

      _______________________________________________________________________

      (EXN) (EXLLF) Excellon Enters Milling Agreement with (HL) Hecla for San Sebastian Sulphide Ore

      Feb. 26, 2018 /CNW/ –

      Highlights

      “Toll milling arrangement expected to commence in 2019 following successful completion of 4,000 tonne bulk sample testing program at Miguel Auza Facility in Q3 2018”

      “Expected milled tonnage of 400 tonnes per day (“tpd”) or 12,000 tonnes per month to be batched processed under formal milling arrangement”

      “Expected to increase the Company’s operating cash flow and reduce milling cost per tonne and all-in sustaining cost (“AISC”) per payable ounce on Platosa Mine production”

      “Ample capacity remains available to process increased Platosa Mine production and potential new discoveries at either Platosa or Miguel Auza”

      https://ceo.ca/@newswire/excellon-enters-milling-agreement-with-hecla-for-san

        Feb 26, 2018 26:00 PM

        EXN up 1.72% today to $1.77

          Feb 26, 2018 26:05 PM

          I’ve owned EXN for a long time and they’re one of my largest holdings. Watch the weekly chart since the BBs appear like they’re going to narrow considerably in the next few weeks. If they do, I’ll add to my position.

            Feb 26, 2018 26:09 PM

            Thanks for the heads up on the BBs Doc.

      Feb 26, 2018 26:00 PM

      An eyesore? 😮
      It seems true that the usual price chart is much more easily understood but I’ve noticed that way too many investors overestimate their own ability to read them properly.

      http://stockcharts.com/school/doku.php?id=chart_school:chart_analysis:pnf_charts:pnf_basics

        Feb 26, 2018 26:01 PM

        “Point and figure charts aren’t just timeless because of their long history — they’re also literally timeless. In other words, they completely ignore time as a component of the chart…”

        https://www.bigtrends.com/education/the-basics-of-point-figure-charts/

          Feb 26, 2018 26:09 PM

          Yeah, I just read that they are not based on time, but on price action only.

          I understand that there are X’s for uptrends and O’s for downtrends, however, as I started reading over the info from stockcharts (that I’ve read before) my mind glazes over because it just doesn’t make sense to me where the 2 red numbers on the right come from, or how to really use these charts.

          Most charting using candles or lines makes sense to my eyes immediately, and I see what happened on the daily or weekly or 5 min or whatever. For some reason, I’m point & figure chart handicapped, and just don’t see the reason to use them over a traditional candlestick chart.

          What is the main advantage of using a point & figure over other charting methods in your experience?

            Feb 26, 2018 26:16 PM

            I notice that in addition to time being absent, that there is no volume indicators either. It seems the draw is that they are totally based on just price, and help in showing where areas of support or resistance are in straight or 45 degree trendlines.

            Still, I just can’t get my head around why to use them, but realize it is my own limitation. They just hurt my mind and I immediately want to switch to a candle or line chart after about 10 seconds….. but that’s my burden and loss.

            Feb 26, 2018 26:19 PM

            I wouldn’t argue that there’s an advantage to using them “over” the usual charts but they represent one more tool. Many seem to want to keep things a little too simple but I like splitting hairs. The more tools/indicators that are in sync with one another, the better.

            I look at everything when I am speculating in the junior miners – technical, fundamental, etc. Trading the big liquid stuff is much simpler.

            Compare the indicators for GDXJ today to those of two years ago and you can see why using too few tools can leave big blind spots that lead to misplaced confidence:

            http://stockcharts.com/h-sc/ui?s=GDXJ&p=W&yr=3&mn=3&dy=22&id=p16711584967&a=580017739

            Likewise, our technical views on gold can be strengthened by a fundamental understanding of the situation for the dollar, debt, and the economy.

            Feb 26, 2018 26:40 PM

            Good thoughts Matthew, and yes, it is nice when multiple indicators on different charts line up for confirmation. Too few tools can leave blind spots, but no chart analysis or technique is going to be right all the time either, so getting multiple vantage points is key.

            That is why when looking at Gold on the weekend weekly charts, that I like to see what Gary Wagner, Gary Savage, Morris Hubbartt, Ira Epstein, Goldfinger, Avi Gilburt, Jordan Roy-Byrne, Doc, and you have to say…… and look at things from multiple angles.

            I also see the benefit of taking in the fundamental data on supply/demand, currency fluctuations, interest rates, inflation data, sentiment data, etc… and add them into the mix.

            On the smaller and more thinly traded mining stocks, I actually value the news releases more. Breaking news (like drill results, permitting updates, capital raises, acquisitions, etc…) tend to push the smaller illiquid stocks around a bit more than the bigger juggernauts.

            Feb 26, 2018 26:08 PM

            The P&F price objective for IPT points to a ten bagger from here. Makes sense to me 😉

            http://stockcharts.com/freecharts/pnf.php?c=IPT.V,PWUADANRRO%5BPA%5D%5BD%5D%5BF1!3!0.125!!2!20]

            Feb 26, 2018 26:28 PM

            +10

            GH
            Feb 27, 2018 27:50 AM

            Richard Russell was a fan of P&F charts. I’ve always meant to integrate them into my analyses, but haven’t yet.

            “The more tools/indicators that are in sync with one another, the better.” Maybe the most important factor in success, for me–my results correlate strongly with the patience I exercise to wait for a convincing confluence of signals. It’s always good to look from multiple angles to try to figure out what we’re dealing with.

            https://mir-s3-cdn-cf.behance.net/project_modules/disp/239af435735483.56062ad5c7011.jpg

            Feb 27, 2018 27:00 AM

            Point & Figure charts started because of manual plotting on graph paper w/ pencil, so I could see before electronic charting how they would be efficient and well utilized.

            There are just so many tools now with Line charts, OHLC charts, and Candlestick charts and the myriad of chart indicators and overlays, that my tendency is to lean on those before wanting to check out a point and figure chart, but I get it…. more indicators, more confirmations, and more angles.

            Perhaps because of their propensity to ignore time and volume and just focus on price action, it may generate good upside/downside targets and clear out some of the noise to simplify price targets.

            I could see utilizing it as a confirming tool, but the lack of time and volume make it less attractive to me for short-term swing trading. On a P&F chart, one side of the chart could be made up over a year and the other half over 2 weeks, so it seems better suited for medium term to longer term price forecasting for upper/lower targets. (it also seems like a really tripped out game of Tic-Tac-Toe) 🙂

    Feb 26, 2018 26:47 PM

    How Infrastructure Is Driving A Commodity Boom
    By Richard (Rick) Mills

    “As a general rule, the most successful man in life is the man who has the best information.”

    “The global economy is booming again after years in the doldrums, commodities are back in a big way, and metals prices are for the most part, way up.”

    “In our last article showing how commodities are the place to be in 2018, we looked at five drivers: inflation, the low dollar, economic growth, the relative undervalue of commodities versus other sectors, and tightness of supply. This article expands on the economic growth argument, and explains how commodity prices are being moved by a bevy of infrastructure projects around the world – ”

    https://safehaven.com/article/44982/How-Infrastructure-Is-Driving-A-Commodity-Boom

    Feb 26, 2018 26:54 PM

    (PGE) (PGEZF) Group Ten Metals Identifies 12 Major Geophysical Conductor Anomalies at Stillwater West Project, Montana, USA
    February 26, 2018

    https://grouptenmetals.com/news/2018/group-ten-metals-identifies-12-major-geophysical-conductor-anomalies-at-stillwater-west-project-montana-usa/

    Feb 26, 2018 26:04 PM
    Feb 26, 2018 26:33 PM

    Looks like a stage 2 advance in the works (just need the 30 week MA to start rising):

    http://stockcharts.com/h-sc/ui?s=IPT.V&p=W&yr=3&mn=3&dy=22&id=p59463566939

    b
    Feb 27, 2018 27:26 AM

    If today is any indication, a dec low gold price will provide a huge buying opportunity…..unless the gold price keeps falling of course.