Jordan Roy-Byrne, Founder and Editor of The Daily Gold, joins us to unpack the macro and technical factors that may be the bell ringing that the bottom is in for gold, silver and precious metals stock ETFs (GDX, GDXJ, SILJ) charts. We start off recapping points made in the prior episodes and articles from Jordan pointing out that back in September we noted that single digit daily sentiment readings, the lowest net speculative position in 20 years, the inversion of the yield curve with the 3 month and 2 year over the 10 year treasuries, and the non-confirmation bottom in silver and the mining stocks when gold continued to make new technical lows. The preponderance of evidence is that the low in PMs is in place at this point, ending the 2 year cyclical bear market.
Next we review how the US dollar weakness has been another tailwind for the PMs, and discuss if we’ll see a medium-term pullback if the greenback starts to rise, and if we see tax loss selling hit after US Thanksgiving and heading into the first few weeks of December. Jordan feels the larger debate now really is, if we’ll see the kind of rebound we did in 2009, 2016, and 2020, and if we’ll start to see real outperformance in the precious metals sector relative to general equities and other asset classes.
He feels we may still see some basing and backing/filling for the next few months, more like what we saw in 2018 or 2001-2002, but that ultimately, we need to start seeing confirmation of gold, silver, and the mining stocks outperformance over other sectors. The crucial piece of fundamental news is still going to be when the Fed announces that they’ve done their last hike heading into the first quarter of 2023.