Jordan Roy-Byrne, Founder and Editor of The Daily Gold, joins us to review the technical support and resistance price levels he is watching in gold, silver, GDX, and GDXJ. We start off reviewing the all-time high monthly and quarterly close we saw last week to close up March, and that we have a chance to make a new all-time high weekly close based on where things are currently if things hold up going into Friday’s close. Jordan is encouraged to see silver and the PM mining stocks outperforming gold recently, and noted that GDX and GDXJ did pop above key resistance yesterday, and we’ll need to see some follow though. Another point he stressed was that a key indicator he follows, the advance/decline line and rate of change is signaling that we may see a healthy breadth thrust across the gold and silver mining stocks, which is constructive for the whole sector.
Next we got into a nuanced discussion about where the PM mining stocks are at present, and that many of them should actually be referred to as cheap, rather than undervalued; with the later designation being reserved for companies that do have resource estimates or economic studies that indicate that they have true value that is not being properly factored in. For many stocks in the sector though, especially the earlier stage drill-plays, they don’t really have the demonstrated and defined value to leg to stand on, which is a key distinction. In addition, many producers, have seen considerable cost increases from a similar gold price 12 years ago or even 3 years ago, and thus their margins have been compressed, which explains why they are more cheap versus truly undervalued.
We wrap up with Jordan outlining that we are still quite early in this new secular bull market unfolding, and that based on different takes at the price projections from the cup & handle pattern, that there are logical ways to point to a gold price in the $3000 – $4000 range by late 2025. This kind of move will drag the whole precious metals sector up with it, and should offer some solace to investors that may have missed the move higher in PMs over the last 5-6 months, as there is still plenty more room for upside appreciation in the sector.
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