Steve Penny Provides Technical Analysis On Platinum, Gold, And Silver
Steve Penny, Publisher of the SilverChartist Report, joins us to share a handful of charts (all posted below so you can follow along) starting off with platinum, then gold, then the gold:Dow ratio, and finally silver. We review both short-term daily charts with weekly and longer-term charts to outline key support and resistance levels to watch in each sector.
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Since we have a segment here with Platinum and the PGMs in focus, and with Group Ten Metals having an epic run higher today (up 20%) then it seems worthy of a repost of our recent interview Mike Rowley.
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(PGE) Group Ten Metals Releases Their NI 43-101 Maiden Resource Estimate at Stillwater West
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Korelin Economics Report – Oct 28, 2021
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Michael Rowley, President and CEO of Group Ten Metals (TSX.V: PGE – OTCQB: PGEZF) joins us for an update on the maiden resource estimate at the Company’s flagship Stillwater West PGE-Ni-Cu-Co + Au project in Montana. Mike unpacks the compelling mix of metals, the resource size, and how this compares to peer projects with their inferred mineral resources totalling 2.4 million ounces of palladium, platinum, rhodium, and gold; plus and additional 1.1 billion pounds of nickel, copper, and cobalt.
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There are 14 drill holes pending in a 10,000 meter step-out exploration program that will be focused primarily on 3 of the most advanced targets – Chrome Mountain, CZ, and the HGR/Iron Mountain Target areas.
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The Company is still reviewing options for its secondary projects; the high-grade Black Lake-Drayton Gold project, adjacent to Treasury Metals’ development-stage Goliath Gold Complex in northwest Ontario, and the Kluane PGE-Ni-Cu-Co project on trend with Nickel Creek Platinum’s Wellgreen deposit in Canada’s Yukon Territory.
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http://www.kereport.com/2021/10/28/group-ten-metals-releases-their-ni-43-101-maiden-resource-estimate-at-stillwater-west/
Here’s a good chart that Matthew posted on the Joe Mazumdar blog for Group Ten, where he noted the nice volume on todays big move up. Thanks again Matthew!
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https://stockcharts.com/h-sc/ui?s=PGE.V&p=D&yr=1&mn=1&dy=0&id=p05252615824&a=1057182296
As mentioned above, Sylvania Platinum is another company in the PGM space that I’ve been beefing up my position in this year as a solid Aussie producer of Platinum and other metals.
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> Here the Corporate Presentation for Sylvania Platinum (SLP.L) (SAPLF):
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https://cdn-ceo-ca.s3.amazonaws.com/1god8d0-20210906%20Sylvania%20FY2021%20Presentation%20FINAL.pdf
Implats In Talks To Become A Platinum Metals Giant
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Bloomberg News | October 27, 2021
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“Impala Platinum Holdings Ltd. is in talks to buy its smaller rival Royal Bafokeng Platinum Ltd., in a deal that Implats said may create South Africa’s largest platinum-group metals producer.”
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“Flush with cash after higher rhodium and palladium prices, Implats is seeking to expand by buying lower cost and mechanized assets as some of its deep-level operations near their end. The company said Wednesday a deal for all of Royal Bafokeng’s shares may involve cash and equity and the outstanding details could be concluded in the coming weeks.”
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https://www.mining.com/web/implats-in-talks-to-become-a-platinum-metals-giant/
(SVM) Silvercorp Metals Reports Adjusted Net Income of $13.6 Million, $0.08 Per Share, and Cash Flow From Operations of $30.9 Million for Q2 Fiscal 2022
– Nov. 4, 2021
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– Mined 292,468 tonnes of ore and milled 271,816 tonnes of ore, up 9% and 3% compared to the prior year quarter.
– Sold approximately 1.7 million ounces of silver, 800 ounces of gold, 17.3 million pounds of lead, and 7.6 million pounds of zinc, representing decreases of 1%, 64%, and 7% in silver, gold and lead sold, and an increase of 3% in zinc sold, compared to the prior year quarter.
– Revenue of $58.4 million, up 4% compared to $56.4 million in the prior year quarter.
– Net income attributable to equity shareholders of $9.4 million, or $0.05 per share, compared to $15.5 million, or $0.09 per share in the prior year quarter. The decrease was mainly due to an unrealized loss of $4.1 million on investments in the current quarter compared to a gain of $2.8 million in the prior year quarter.
– Adjusted earnings attributable to equity shareholders of $13.6 million, or $0.08 per share, compared to $15.4 million, or $0.09 per share in the prior year quarter. The adjustments were made to remove impacts from non-recurring items, share-based compensation, foreign exchange gain/loss, gain/loss on investments, and the share of associates’ operating results.
– Cash flow from operations of $30.9 million, up 4% or $1.3 million compared to $29.6 million in the prior year quarter.
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https://tinyurl.com/2p98cayu
And increase of 6% in stock price? I don’t get it when comparing to other stock performance this quarter, in particular AUY with a lot of silver credits.
Solid revenues and free cash flows for a Junior/mid-tier Silver producer with substantial Zinc & Lead credits. They had a quarterly operations report out, so I shared it.
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Zinc and Lead prices have been doing very well this year, so they are banking it for a smaller mid-tier producer. Silvercorp has also won 2 different mines from Chinese auctions on the cheap this year; which will expand their production profile in the years to come far more than most typical acquisitions they could have made. They also have nice sized strategic stakes in a few companies like New Pacific Metals NUAG, and Volcanic Gold (VG), which are solid ancillary assets.
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SVM has the lowest AISC of any Silver miner at around $7 per Silver eq ounce. They are best in class for the segment they are in.
… and yes, SVM was up 6.52% today, so I’m not sure what your point was there.
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AUY was up 3.48%, so that’s nice too I guess… ?
On the silver producers with great exploration upside IPT is a good one in a jurisdiction where the government is not likely to confiscate your mines and production.
The Chinese government recently banned their fertilizer companies from exporting their products and the same could easily happen with silver.
I love IPT Impact Silver, and it is one of my largest silver producer positions (larger than Silvercorp), especially for that exploration upside you mentioned. It is one of the highest torque little miners there is, but IPT doesn’t have near the production profile nor the industry leading low costs of SVM, so I like them both in my portfolio for different reasons.
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Yeah I’ve heard that nonsense about “the Chinese could seize their mines” or block their exports, for over a decade now with SVM, and yet, so far they’ve continued to do great operationally while the naysayers watched from the sidelines. Mexico isn’t always a treat of a jurisdiction either with rising taxes, gang cartels, and many activist groups, but I still hold 2 dozen miners operating in Mexico and just roll with it.
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Maybe you missed the part up above the where I mentioned that the Chinese government just awarded them the winners of 2 different auctions of past producing mines. Instead of taking their mines away, China is essentially expediting Silvercorp mines at pennies on the dollar. Haha!
Last year it was pretty easy to make money trading Hong Kong and Shanghai stocks but the last six months it seems to be more difficult, to the point where I’ve sold out of all my Chinese stocks except Zijin(2899) and CGN Mining(1164). Xi’s “shared prosperity” policy to me means he doesn’t give a crap about common shareholders. Maybe SVM with their mostly Chinese upper management has the ear of somebody in Beijing….whatever works.
I discovered IPT on this site so…
Thank you again KER.
Yes, there is no doubt that doing any kind of business in China is not without risk, so I didn’t mean to imply there wasn’t risk… (just ask the Chinese tech stocks about that this year).
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However, there are risks everywhere, and all throughout the mining process. Workers can get hurt, tailings dams can break, water can have chemicals leach into them, there can be too much water in torrential rains, or not enough water in a drought, power costs can change drastically (like lately), local communities can revolt against a mine or development project, there can be blockades interrupting business, the mill can have parts break or wear out, the mine block model can be flawed impacting grades, taxes can be raised, laws can be changed, etc…
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I pretty much assume a basic layer of risk at all times being in the mining sector, and figure a good well-run companies with good assets will still have bad luck in that sense from time to time, and don’t wish that on any company, but we’ve seen some things like that this year where both Americas Gold & Silver and Equinox had illegal blockades at their mines, or Iamgold has had a convey of their workers attacked twice now this year. I remember seeing news from some other company that they had lost an employee in a mine or mill accident earlier this year. There was also and exploration company that had their helicopter that hauled people and supplies crash last year, killing the pilot that did contract work for the company. No shortage of risks in mining, and operating in China is not for the squeamish. I don’t normally hold Chinese companies, but technically Silvercorp is a Canadian company with some Canadian management, and Chinese employees and management with a good relationship with the government for over a decade now.
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As for Impact Silver, again – I love it, one of my favorite stocks and it’s particularly a great trading vehicle as well as one that can be held during the longer runs in the PM cycles. IPT typically outperforms (to the upside and downside, depending on the metals trend). I’ve been in both SVM and IPT since 2016 and have rarely had a period without holding both, but they’ve been traded dozens and dozens of times around the core position, buying the dips, and selling the rips.
The Macro Case For Precious Metals
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Crescat Capital – Oct 26, 2021
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“There is no shortage of questions on why gold has significantly underperformed during such an ideal macro setting. Let’s start by looking at the usual fundamental trends of this industry as part of prior historical cycles.”
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“Gold and silver stocks have never peaked at historically undervalued levels. Miners are now trading at the cheapest fundamental multiples we have ever seen.”
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“Assuming the current 2022 free-cash-flow estimate relative to the current enterprise value, the median company among the 50 largest miners in the US and Canada exchange now trades at an unprecedented 7% yield…”
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https://www.crescat.net/the-macro-case-for-precious-metals/
TLT is good to go and that’s good for gold. The decoupling is still in the future…
https://stockcharts.com/h-sc/ui?s=TLT&p=W&yr=3&mn=11&dy=0&id=p73010315763&a=1051398411
Gold has finally confirmed the clear message from the rest of the sector…
https://stockcharts.com/h-sc/ui?s=%24GOLD&p=D&yr=1&mn=0&dy=0&id=p26344475135&a=1051150724
Thanks for those charts Matthew. Yes, nice move by Gold for a close up above those 2 trendlines, breaking above resistance here at the end of the week. Nice!
Gold had its best daily and weekly closes in 2 months and is again above the 30 week MA which is rising.
https://stockcharts.com/h-sc/ui?s=%24GOLD&p=W&yr=4&mn=3&dy=0&id=p71163424936&a=712774405
Is this resistance going to stop gold? I doubt it very much…
https://stockcharts.com/h-sc/ui?s=%24GOLD&p=W&yr=5&mn=0&dy=0&id=p03452260460&a=974275774
It took more than two months but gold has taken back its 3 year uptrend, KAMA and “P” pivot…
https://stockcharts.com/h-sc/ui?s=%24GOLD&p=W&yr=5&mn=0&dy=0&id=p35772935396&a=985479155
Bullish Candlesticks On The Miners
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Morris Hubbartt- Super Force #PreciousMetals #TechnicalAnalysis #Charts #Video – Nov 5, 2021
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http://www.321gold.com/editorials/sfs/hubbartt110521.html
I do believe strongly that this third break above Fibonacci fan resistance is going to stick…
https://stockcharts.com/h-sc/ui?s=%24GOLD&p=W&yr=3&mn=0&dy=0&id=p67446492925&a=1006056230
+3 times a charm…
This break above speed line resistance helps plenty and notice how that resistance perfectly capped gold for the last two weeks…
https://stockcharts.com/h-sc/ui?s=%24GOLD&p=W&yr=3&mn=0&dy=0&id=p67446492925&a=1057371406
Here’s an interesting one to ponder… I’m not sure I completely agree with the correlations outlined, but there is some correlation on the charts, and it’s definitely a unique perspective for consideration.
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Uranium’s Message For Gold into 2022
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Tom McClellan – Nov 4, 2021
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“The message from uranium prices is that gold prices are headed higher. And I have no idea why this relationship works.”
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“Six years ago, I uncovered an interesting leading indication relationship, wherein the movements of uranium prices tend to show up again about 7 months later in the movements of gold prices. I cannot think of any reason why this should matter for gold prices, nor why 7 months seems to be the magical lag time. But my inability to divine a causal relationship does not take away from the obvious correlation, which has been working for at least a few decades now. At some point, when confronted with enough data, one stops worrying about the “why” of a relationship, and comes to accept the “is”.
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http://www.321gold.com/editorials/mcclellan/mcclellan110421.html
At least short term, gold has bottomed versus commodities and put in its best close in 6 weeks versus the CRB…
https://stockcharts.com/h-sc/ui?s=%24GOLD%3A%24CRB&p=D&yr=1&mn=11&dy=0&id=p92844194372&a=951165411
The odds favor more than a short term low…
https://stockcharts.com/h-sc/ui?s=%24GOLD%3A%24CRB&p=W&yr=5&mn=6&dy=0&id=p64393804128&a=1049822052
WAK.AX bought their Western Australian kaolin resource from Rio Tinto some time ago and are ramping up for near term production with a good portion of their kaolin forward sold, probably to the Chinese, whose mine is depleted.
Kaolin is a fine clay used in porcelain, pottery, fine paper, paints and many other applications. WAK happens to have an exceprionally pure and fine resource.
I don’t own or intend buying this stock just yet.
Looks like a bearish H&S top pattern in the works for gold vs silver along with extra bearishness for the drooping neckline and right shoulder…
https://stockcharts.com/h-sc/ui?s=GLD%3ASLV&p=D&yr=1&mn=1&dy=0&id=p46426933512&a=577228753
Looks like a nice little H&S bottom forming for HUI:DIA…
https://stockcharts.com/h-sc/ui?s=%24HUI%3ADIA&p=W&yr=6&mn=0&dy=0&id=p34560336178&a=953633255
GDX has its own H&S bottom in the works…
https://stockcharts.com/h-sc/ui?s=GDX&p=W&yr=6&mn=3&dy=0&id=p09363278563&a=1051124412
Platinum……… has a long way to go….
I pointed out the turn several weeks ago…. Platinum to Palladium .. ratio changed for the better….
Palladium, no more the star light which it has been for 5 yrs….. JMO
You sure did point it out!
Rogers that lol 🤠
Hello Glen…. thanks for the back up… 🙂
A big thank you to The Silver Chartist for investing some time with the KER crew, and sharing both his charts and technical perspectives on Platinum, Gold, and Silver.
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The setup for a rerating in Platinum versus Gold is looking compelling in the medium term, and I’m glad I’ve recently beefed up my Group Ten Metals and Sylvania Platinum positions. I’m also considering getting back into Jubilee Platinum at one point soon, and may buy back my Generation Mining and Platinum Group Metals once they give more clarity on their financing packages.