2020 Outlook For All Metals Investors
Kicking off today with Jeff Christian, Managing Partner at CPM Group. Jeff and I recap some of the recent news in terms of M&A and financings for PM companies. Then we focus on Jeff’s 2020 outlook for a wide range of metals. We chat gold and silver, base metals, battery metals, USD, and global economic thoughts.
Click here to visit the CPM Group website and feel free to email me if you want more information.
It shouldn’t be a year end rally that fizzles in January, Doc, but a move to follow inflation we are seeing in other assets, and will see in food shortly.
Highest daily close in 3 months for GDXJ:
https://stockcharts.com/h-sc/ui?s=GDXJ&p=D&yr=0&mn=7&dy=0&id=p08285255311&a=703348569
Highest daily close in 23 months for SILJ:
https://stockcharts.com/h-sc/ui?s=SILJ&p=D&yr=2&mn=0&dy=0&id=p84831019883&a=639264264
Lessons From 2019, & Hopes/Dreams For The Year Ahead….
by @Goldfinger on 23 Dec 2019
“I have learned to stay humble and remain grateful for the little things in life. The market is a game, a gift, and a limitless challenge all wrapped into a complex enigma of human emotions and economics . May I continue to learn and become a better investor/trader in 2020, while simultaneously helping others to learn, and maybe we can all make some money in the process.” – Goldfinger
https://ceo.ca/@goldfinger/lessons-from-2019-hopesdreams-for-the-year-ahead
“One thing the market does not allow is for “all” to make money.” — Allmost Everyone
Damn typo 🙄
I think Goldfinger said,”while simultaneously helping others to learn, and maybe we can all make some money in the process.” that he was referencing “All” as those he helped with TA coaching and trading as he has a paid subscriber group to his “Trading Lab”.
I inferred from that comment that if he is successful and makes money posting his trades to his subscribers, that it is his hope that people that follow his work would make money along side him in tandem.
Cheers!
Then again, he may have meant he hopes “all” the folks he shares info with and simultaneously learns from in the statement, “maybe we can all make some money in the process.”
Goldfinger is regularly sharing his thoughts and insights for free in articles and daily posts over at ceo.ca and the energy and money website, and he strikes me as sincere in his desire to help other investors learn and profit.
It’s a nice notion for all others one interacts with to be prosperous in their trading, even if it is unlikely.
I get it but think it’s a good idea to remind newbies that it is not possible for everyone to make money. Bull or bear, the great majority loses money (especially when inflation is accounted for).
Igoldadvisor.com has a perspective going forward in his 19th oiece
igoldadvisor on YouTube, of course
IgoldAdvisor on YouTube, of course.
Thanks Marty. Yes, I like to get Christopher’s perspective whenever he puts out a new video. He’s a sharp technician and has a good grasp on the larger macro economic backdrop.
There are a bunch of great quotes from other sharp investors in that article above from Goldfinger, and it is worth the few minutes to read other investors biggest takeaway nuggets of wisdom from 2019.
“In 2019, I learned the US is well past over the edge of the cliff and the End of Empire is here. We have interesting times ahead and anyone who has not stocked their bunker is basically f’d.”
~ @fingerprint42 (Bob Moriarty, 321gold)
“2019 taught me not to underestimate the swing from bear to bull. Earlier in the year, we had reached, what appeared to be, “rock bottom” in prices and sentiment. And now we seem to be in the beginning stages of a bull market. I am excited to see more positive momentum for miners and metals for 2020 while also inviting more investors into the junior resource space.”
~ Trevor Hall, Clear Creek Digital
“I’m not a geologist nor a mining engineer so there will obviously be a lot of potential traps that I won’t see coming. So many things can go wrong and I feel the best way to protect myself is to simply make sure that companies that I invest in are run buy good and competent people with skin in the game. I will never know more than insiders of a company, so if management is very competent, then the project said management have chosen to work on ought to have relatively few insurmountable problems etc. Good management solves problems and bad management creates problems. Lastly, I would say that time increases the likelihood of a positive returns for a company with good management, while time is your enemy when a company is run by bad management. ”
~ Erik Wettering @hhorseman – The Hedgeless Horseman
“2020: We might see a huge recovery rally in many metals and indices, after a break out from a down-trend during the last 8-10 years. Don’t be surprised to see a gain over around 100% in the TSX-V in the next 12-18 months. My favorite black swan in sudden dollar devaluation. This might catapult precious metals even more. And, yes Platinum is a screaming buy now, even without this event.”
~ @Discoveries (Willem Middelkoop, Commodity Discovery Fund)
“Tax loss season is like a garage sale. This year I learned to have lots of dry powder to take advantage of it. Next year I look forward to see how many were good picks and how many were just buying other people’s junk.”
~ @Thecowsaysmoo
Watchlist for 2020
December 23, 2019 – Pete Panda
(Interesting selection of companies to keep tabs on in Gold, Silver, Copper, Zinc, Nickel.)
Gotta love the pitchfork perfection:
https://stockcharts.com/h-sc/ui?s=%24GDM&p=D&yr=1&mn=5&dy=0&id=p13894923442&a=577249153
(NEE) (NHVCF)Northern Vertex Reports Positive Drill Results at Moss Gold Mine, Arizona
by @newswire on 18 Dec 2019
Speaking of Arizona, I see Excelsior got their final permit and it’s time to start making money….
Yeah, I saw that news hit the wires today. That is good news for Excelsior Mining.
(MIN) Excelsior Mining Receives Approval to Start Mining Operations
23 Dec 2019
https://ceo.ca/@newsfile/excelsior-mining-receives-approval-to-start-mining
Some great charts right now. TGCDF appears to be breaking out.
Yeah, there are a number of Gold and Silver stocks continuing to break out.
Check out the 1 year charts of Wesdome, Minera Alamos, K92 Mining, Equinox, Great Bear, Silvercorp, Coeur, Hecla, Mako Mining, Lion One, Balmoral, and Wallbridge. (just to name a few…)
Just today there were some nice upside surges on higher volume in a number of Jr miners.
Some worth noting up more than 20% today:
JAG – up 34%, BDGC – up 28%, GLDN – up 25%, CCW – up 22%, GFG – up 21.7%, DSV – up 21%, HAV.AX – up 20%, BAT – up 20%
The first 2 weeks of January are going to be key to see if these rallies continue
I’d be fine with a lull the first 2 weeks of January and then a measured move higher from late January into February. Really the January close is what is key.
I think this week is key and today was a bigger deal than most realize. January is going to very good.
Yesterday’s action was like a Ron Burgundy day for the PM miners:
Gold @ $1500
Silver @ $17.75
Looking good…
I stand corrected… Looking great! 😉
Green shoots….popping higher.
Gold Futures Jump Back Above $1500 As Silver Surges
Tue, 12/24/2019
https://www.zerohedge.com/commodities/gold-futures-jump-back-above-1500-silver-soars
Eric Coffin points out another strong company continuing to break out that I forgot to mention above – Silvercrest Metals. Truly solid fundamentals and technicals.
____________________________________
@HRA-Coffin _ “SilverCrest pops hard enough to put a new 52 week high under the tree for shareholders, because why the hell not? $SIL”
It’s been a 50 bagger on my original position back in 2015-SILV
Edward Gofsky @EdwardGofsky – Twitter
“$USA.TO Silver stock. Big Picture view. Monthly Chart. Huge {C&H} setup has formed in this silver stock. Starting to breakout of the {Handle}. Nice {Wave 5} setup also. $5.20 triggers long”
Well this one I do own ……so $5.20 sounds good to me……as a first leg up towards $10 of course
+10 –> Yes, but of course…… 🙂
Would not surprise me if USAS goes to 50 in 5 years,
and may all your Christmases be white. Good health to all,
and God bless us, everyone!
+50 Agreed in 5 years. Merry Christmas Bonzo Barzini!
Thought USA was on its way when it hit $4.20. Maybe next time it gets through $4.20
Yeah, it took a smoke break at $4.20, but it is definitely heading higher.
Nice Silver chart from our buddy FranSix posted over at ceo.ca.
@F6 – “Re: Silver Daily #charts ”
“Silver prices broke out from its wedge formation and also broke above its long-term downtrend, once again. What had been a failed breakout is now staging a recovery: ”
Gold did the same thing. This is not 2016 in any way as so many were assuming…
https://stockcharts.com/h-sc/ui?s=%24GOLD&p=W&yr=5&mn=11&dy=0&id=&a=699861636
Yep, it looks like that was a bull flag pattern and the PMs are now breaking out above resistance. A nice way to close up a great year for Gold & Silver.
And with most miners bottoming on October 15th, more analysts should have realized how it was going to for the metals. Instead, most have continued to look for lower prices and nothingness in January and even beyond.
Good luck to those who think BBB is going back to .15 or IPT to .25-.30.
https://stockcharts.com/h-sc/ui?s=SILJ&p=D&yr=1&mn=9&dy=0&id=p02321507336&a=700958480
Agreed. The miners have been strong and heading higher for the last 2 months, and while not all stocks participated (as many Jrs sold off) the mid tiers and Major producers have been doing just fine with current prices.
Now that the metals are moving higher again, the Juniors will follow suit, and we’ve already seen some nice surges in some last week and this week. I wouldn’t expect many to pull back into this strength, and those commentators waiting for lower lows, may have their hopes dashed once again and need to chase things higher.
I’m not sure why more didn’t buy into any weakness that they already saw in November or December, as that was the bottom-fishing opportunity during tax loss selling season (which wrapped up earlier this year).
It seems like investors have amnesia that this same pattern of low sentiment from pundits and retail investors starts every year and escalates into the holidays, Where folks are waiting for lower lows at the beginning of the next year, but then the sector bottoms and rallies into year-end seasonal strength, and this brings in more buying to fuel the Q1 Run. Then investors have to start chasing things higher in January & February surges, until the buying gets exhausted right before the PDAC in March.
People were scoffing the last 6 years in a row at those buying miners during tax loss season, and they rallied the succeeding year in Q1 each time.
(2014 Dec into Q1 2015)
(2015 Dec into Q1 2016 & Q2 2016)
(2016 Dec into Q1 2017)
(2017 Dec into Q1 2018)
(2018 Dec into Q1 2019).
Now we are seeing some real strength the last 2 weeks in the metals and miners and it sure seems like a similar pattern is setting up. It looks like a really solid close to 2019 for the Precious Metals, and I’d expect that energy to carry forward into 2020.
TGCDF- I sold 40% of my position today @$5.22
Is Jeffrey Gundlach right About Copper, Gold & Interest Rates?
Richard Baker – Monday December 23, 2019
RUNNING HOT
Crescat Capital – December 21, 2019
“The highly probable and downright inevitable unwind of today’s trifecta of financial asset bubbles: stocks, corporate credit, and Treasury bonds may soon morph into brutal bear market. The end game is unstoppable in our view and approaching fast. The Fed is between a rock and a hard place. It has been printing money like it’s the depth of the Global Financial Crisis while stocks and corporate credit are flying high reflecting a dangerous combination. The panic stimulus at this point in the business cycle is completely understandable, but it is only hastening the unwind of the imbalances the central bank has created and been impossibly trying to maintain. The idea that money printing is an insurance policy that does not come with a cost is simply wrong.”
“The Fed’s monetary policy is running hot and long-term interest rates aren’t aligned accordingly. John Taylor, a Stanford University economist once considered to lead the Federal Reserve, developed a formula to calculate where the Fed funds rate should hypothetically be according to inflation rates, strength of the labor market, and potential output of the economy. Using that as our baseline for interest rates, the Fed isn’t just running an aggressive inflationary policy on the short end of the curve, long-term rates are also notably out of balance. For instance, the 10-yr yield vs. the Baseline Taylor Rule rate is now at its most extreme in 44 years. Inflation became a problem during all times this spread went negative. What makes this issue even more unique is the fact that on top of running an extreme loose rate policy, the Fed is printing money in a massive way. It’s hard to say monetary policy won’t come at a major cost this time.”
“Precious metals are poised to benefit from what we consider to be the best macro set up we’ve seen in our careers. The stars are all aligning. We believe strongly that this time monetary policy will come at a cost. Look in the chart below at how the new wave of global money printing just initiated by the Fed in response to the Treasury market funding crisis is highly likely to pull depressed gold prices up with it.”
Yes Ex, gold just got a new pair of running shoes, their called “The Fastest Pumps In Town”, made in America by The Federal Reserve. LOL! DT
Agreed DT. I just put on a pair of “The Fastest Pumps In Town” myself for a quick jaunt:
http://d23ew9jpzkv467.cloudfront.net/content/139912/1e15e23c76ec50181b002c7379c4be9e.gif
Now this one I own so sure …..giddy up. Lol
A Message from the CEO – This Tide Will Turn
By Peter Grosskopf – CEO of Sprott Inc – Tuesday December 24, 2019
“The big story of 2019 for financial markets turned out to be the melt-up in U.S. equities. This big wave has not only floated broad equity averages to fresh all-time highs but has also extended the length of this bull market to the longest on record. Market surfers cite favorable conditions such as decent economic strength, supportive interest rates and a central bank pivot back towards easing as powering excellent runs by equity all-stars (from FAANG stocks1 to financials). Traditional riptides, such as widening credit spreads and surging default rates, are nowhere to be found. ”
“We caution our clients that 2019’s uniquely favorable conditions are unlikely to be sustainable, especially at the margin. Shifting fundamentals are creeping into the forecast and are likely to create more ominous wave sets. Speaking from the perspective of Sprott’s precious metals franchise, gold performed extremely well in the face of this year’s market jubilee, which transpired amid supportive conditions including a stable U.S. dollar and benign inflation. (As of this writing, gold bullion was up nearly 16% through last Friday’s close.)”
“For twilight surfers, however, we believe gold’s lifeguard role has never been more important.”
https://sprott.com/insights/a-message-from-the-ceo-this-tide-will-turn/
This is the first PM move that I’ve been chasing in 4-5 years. I’ve a low cost basis on the vast majority of my PM positions and what I mean by chasing is small additions so my cost basis remains low. This is a fun move and we’re no where close to the highs of the rally in 2015-2016. Many of these stocks in their new consolidations show strength and momentum indicators that are telling you these stocks are ready for another move higher before they consolidate again.
Most of my positions were put in place over time in tranches at much lower prices. However, I also averaged up in a few names recently (as they did a recent dip) that I already had a low cost-basis in place, because I wanted a slighting larger position in those names, and the technical set ups looked good for another push higher. I’ve been fully deployed since a little window dressing last week.
May the good folks here at the KER have a prosperous end to 2019 and even better 2020. Cheers!
SILJ is at a 26 month high and is ready to fly…
https://stockcharts.com/h-sc/ui?s=SILJ&p=W&yr=3&mn=11&dy=0&id=p54037267687&a=706220219
Today was a very solid close in the PM miners and my portfolio is fat and happy heading into the holidays.
Truly stellar action in so many of the Gold and Silver stocks lately and more to come.
Ever Upward!
This is now just the beginning of a multiple year move up for these miners. Another difference to this rally as compared to past rallies that faded is the fact the volume in this move continues to outperform. I believe some big money is starting to move in this sector and it shouldn’t stop. Wait until the dollar rally starts to fade—-as mentioned before, the dollar is starting to show cracks and 2020 should be the year when we start to see the dollar move lower
Looking forward to a few more years of rallies in the miners.
GDX double-bottomed years ago at $12.23 in Sept 2015, and then it’s Major Low at $12.11 in Jan 2016. GDX has been up 200%-250% since the end of the bear market for the last 4 years (with gyrations higher/lower as all markets do), and there were plenty of gains made on the miners for those that bought the dips and rode pricing back higher.
There were actually higher volumes in GDX and GDXJ back in 2016 than in 2019, but the RSI and TSI got into much higher overbought readings this late Summer 2019, as compared to the readings in 2016. When more volume shows up in 2020 like we saw in 2016, then things will really get moving in the PM miners and they’ll break above the 2016 highs, just like gold broke above the 2016 highs a few months back. There is just a delay in the miners catching up to the moves in the metals, which is normal.
GDX Chart showing the double bottom in Sept 2015, and then it’s Major Low at $12.11 in Jan 2016. Also, note the volume levels in 2016 versus 2019, and finally the RSI and TSI in 2016 versus where they got this last summer. Looking forward to where things are headed in 2020 in PM space.
Huge HUI breakout vs GLD:
https://stockcharts.com/h-sc/ui?s=%24HUI%3AGLD&p=D&yr=1&mn=0&dy=0&id=p23775180954&a=708995573
The XAU Gold and Silver (Mining) Index is up 73% since the 2018 low and 173% since the 2016 low. The new multi-year uptrend began in 2016.
The depth and duration of a correction is heavily influenced by the move that precedes it as well as what part of the cycle it is in.
The big correction following the HUGE gains of 2016 made perfect sense and so did the ones that began early this year and in September.
There are good reasons different waves within each cycle tend to look the way they do regardless of the scale.
https://stockcharts.com/h-sc/ui?s=%24XAU&p=W&yr=11&mn=11&dy=0&id=p22929224732&a=618520531
At the 2016 low, the XAU needed a 500% rise to reach its old all-time high. Now it requires just a 120% move.
+2016. Yes, that Jan 19th, 2016 was when most miners put in their major lows, and the Gold & Silver miners definitely did. That was when the baby bull was born, and the move up in miners in 2016 was the first impulse leg to higher highs. Then there was a large Wave 2 consolidation in a sideways to down digestive period, and then 2019 was the beginning of Wave 3 higher and we’re still in it. We have higher to go in the miners before they roll over into a corrective Wave 4 (maybe late 2020 into 2021), and then after that the blow-off top in Wave 5 (likely from mid 2021 – 2022).
We have way higher to go before the wave 4 that you’re talking about. We are now starting the 5th wave within your larger 3rd wave…
https://stockcharts.com/h-sc/ui?s=GDX&p=W&yr=8&mn=11&dy=0&id=p72213297442&a=691390774
Yes agreed. We are in that 5th wave on the shorter duration pattern, which is bullish for the medium term, and that is still within the larger pattern. I don’t know the exact timeline of the larger pattern as it really more about the length of waves and pricepoints being eclipse. I was just guestimating it based on a 5 year bear from fall 2011 to Jan 2016 being about 5 years, and the bull coming out of that lasting at least as long, and probabilistically even longer into 2022 or maybe 2023.
What really surprised me months ago is how many people besides Jordan Roy-Byrne thought this correction could last for as long as 18 months. They all completely misunderstood the strength and character of this move (that began in May) as they compared it to 2016.
New multi-year highs won’t take long.
https://stockcharts.com/h-sc/ui?s=GDX&p=D&yr=1&mn=7&dy=0&id=p51468759003&a=643586306
Great point Matthew. It’s been a hell of a strong move off the September lows in 2018, in the miners, within the larger overall Bull market move off the Jan 2019 Major lows. Why pundits were expecting a long drawn out 18 month correction is a head scratcher.
There were a number of market commentators on other chat forums and Twitter proclaiming that 2019 was just another 2016, so maybe they felt there would be a long digestion period like late 2016- late 2018, but the setups, sentiment, and indicators were not nearly the same. Like you pointed out in one of the charts above some of the weekly indicators weren’t even as overbought in 2016 as they are now, because the move from late 2018 into 2019 has actually been even more bullish.
What is astonishing to me is how many people didn’t believe in the new bull market in 2016, on the subsequent series of higher lows and testing of resistance in 2017 and 2018 and even into Q1 2019 (which were all very bullish signals), and then even in 2019 where Gold clearly took out the 2016 peak of $1377.50, many were still calling this a continuation of the bear market.
I read someone today calling this last bear market 8-10 years. (WFT?)
The bear was from 2011 to 2015 in Gold and 2011 to Jan 2016 in the miners. How in the world is that 8-10 years?
The only way people could say it was an 8-10 year bear market is if they still felt Gold & Silver or the mining indexes were making lower lows all this time (which they clearly were NOT). It isn’t rocket science, Bear markets continue to make Lower Lows, and Bull market make higher highs.
The lows were put in 4 years ago in the metals & miners. Since the $1045.40 low in Gold (the prime mover), it has added $500 on its run to $1566 a few months back. That is called a Bull market for anyone still wondering, and is in no uncertain terms a Bear market.
It really seems those that were hesitant on the breakout this year, or that expected another year 1/2 of downwards pressure just aren’t on the same planet with the rest of the market, or looking at the charts at all. They clearly haven’t believed in the bull market that has been playing out all these years, and likely didn’t position in early 2016, or for the seasonal rallies in 2017, 2018, and 2019, and may have missed most of the move later this year. It’s stunning to have missed such a large move in the metals and so many tradable rallies in the miners.
Maybe when Gold is in the $1600s or $1800s they can admit, “Hey, we may be in a bull market in the Precious Metals.” (LOL!!)
Yes they will admit we’re in a bull market but will probably never concede that we were already in one for the last few years. The beginning of a big new bull is always like that but when we measure the bull market gains in the future, the only place to start that measurement is at the 2016 low. The XAU’s 173% gain since then is hardly the product of “sideways action.”
The following HUI chart could hardly be more bullish and the bears are toast if they don’t stuff it real good by the end of the week (which ain’t gonna happen).
https://stockcharts.com/h-sc/ui?s=%24HUI&p=W&yr=4&mn=11&dy=0&id=p38667533605
Agreed 1000% Matthew. Bull markets are measured from Major lows (like what we saw in the miners in Jan 2016) to their Major highs.
The last cyclical Bull market ended at it’s Major high in Sept of 2011, so that is where investors should have started measuring the new cyclical Bear market. That Bear Market ran from Sept 2011 to Jan 2016.
The new cyclical Bull market, started in Jan 2016 and will run until (??) – maybe 2022 or 2023?.
Those that waiting for higher Gold prices in the $1600-$1800s or GDX in the $40’s have already missed years of the current bull market, but that is how these cycles go.
The bull shakes off as many riders along the way, as it climbs the wall of worry, and doubt.
Now get a load of this SILJ vs GDX chart. 2020 just might be 2016 2.0:
https://stockcharts.com/h-sc/ui?s=SILJ%3AGDX&p=W&yr=5&mn=1&dy=0&id=p64236515579&a=709017161
Never mind the likes of Brent Cook, John Kaiser, etc., the silver stocks are where it’s at. Again.
Yes sir. A breakout above the major trendline for SILJ:GDX, as well as a break above the Ichimoku cloud (Spanky would be proud). 🙂
Yes, the Silver miners have been very strong as of late (just like they were in 2016), and they still have more catching up to do next year. Looking forward to it.
The monthly SILJ:GDX chart looks just as good. if you can’t see it, it shows a big pitchfork breakout (complete when December ends) and the first monthly MACD buy since 2016.
https://stockcharts.com/h-sc/ui?s=SILJ%3AGDX&p=M&yr=11&mn=1&dy=0&id=p37199820866&a=709018172
Correction: “within the larger overall Bull market move off the Jan 2016 (not 2019) Major lows…”
2nd correction: (WFT?) should have been (WTF?) 😉
Just wondering if the scrutiny on JPM & its trades is bearing weight on the CABAL’s influence this quarter.
Stewart Thomson says: “The biggest bull run in history for gold and silver stocks is getting underway, and it’s going to accelerate regardless of whether Trump or the democrats win in 2020. Thousands of gold bugs who shorted the stock market in 2009 are buying it now. They will be left behind by gold and silver stock investors if Trump wins. If Warren wins, they could be wiped off the financial map.”
http://www.321gold.com/editorials/thomson_s/thomson_s_122419.html
I see the market manipulators just would not give us a Christmas present of $1500 gold.
Close, but…..
$1499.10. Close enough. It was up over $1500 most of the trading day, which really boosted the miners into the close. This was one of the bigger days up in my portfolio as a whole, so maybe the manipulators were off duty and already sipping on eggnog.
Gold was up 1.1% to $1499.10; and GDX was up 3.2%, and GDXJ up 3.7%
Silver was up 2% to $17.85; and SIL was up 3.5% and SILJ was up 4.35%
All in all it was a nice 1/2 day close going into the holidays.
Twas the night before Christmas and all through the house….
Well, at least, Gold futures made it to $1504
Not to be forgotten but am adding a little to uranium stocks which are correcting again. Nobody is talking about this sector and that gives long term investors a head start on it.
I’ve added a little to my Uranium miners as well Doc. I’m mostly in UUUU, URG, UEC, NXE, and I’ve got a small AEC position. I was debating adding back a position in DNN today, but am not in as big of rush on the Canadian Uranium companies as the US based ones, pending the Working Group’s announcement in Q1 2020.
For nuclear fuel enriching and reselling, LEU is typically a strong performer, so I’ll likely add it back into the mix in the near future as well.
Wow, I just went and checked LEU and it has already more than tripled this year. Gadzooks!
Ex, I added to DNN this week along with UUUU—I especially like UUUU for a host of reasons. I’ll be adding to UEC soon. The supply/demand of uranium has finally evened out in my view and the number of reactors being built worldwide is amazing.
I just checked LEU and it looks, technically, like this company just started to run. I wish I had kept my eye closer on this one for the breakout.
Agreed Doc. UUUU has both the ISR mining and processing centers and the hardrock deposits and mill for optionality on higher Uranium prices. DNN has ISR mining potential in the Athabasca, and will be the next new Uranium producer in Canada. UEC is a solid development stage company with their hub and spoke strategy of multiple deposits feeding their processing center.
Yes LEU can run much higher, but that initial move off the bottom this year was ahead of the curve of the rest of the companies. I guess they are doing a lot with processing and reselling to utility companies behind the scenes and I’ll need to take a closer look at their last few quarters of financials. They are a bit different in that they aren’t miners and are more downstream in the fuel cycle.
Still most of this sector has barely woken up since the double bottom in late 2016 and again in late 2017 in the Uranium spot price market. The market needs to see more longer term off-take agreements being signed to move the spot and longer term contract prices higher.
The decision from the Trump administrations “Working Group” is also going to play a part as a catalyst in the sector. That’s why I’ve been more heavy on the US based companies for the last year+.
There is also Lightbridge Corp working on a safer and more efficient nuclear fuel where the Uranium rods are clad with more robust metals and they are partners with Orano (previously Areva the large French nuclear conglomerate).
I could see their stock take off in the next 1-2 years as their fuel will be more sought out by utility companies.
LTBR is also working with Thorium fuels for countries proposing those reactors.
Lightbridge is still more earlier stage in some of their trials and in awareness and adoption of their fuel rods, but there aren’t many companies doing what they are doing in the marketplace, so they’re one I’m going to keep a closer watch on.
Australia Taking Baby Steps Towards Nuclear Energy
Valentina Ruiz Leotaud | December 15, 2019
“Australia’s Parliament presented this week a report that outlines a series of measures to take into consideration if the country wants to move forward with the development of nuclear energy.”
“The report, which arose from a legislative committee’s inquiry into the matter, states that it is important for the island nation to consider the prospect of nuclear technology as part of its future energy mix…”
https://www.mining.com/australia-taking-baby-steps-towards-nuclear-energy/
Here it is, Christmas eve, and as visions of sugar plums dance through my head I am wondering what Matthew, Doc, LPG, and Excelsior think AEM, AXU, AG, DRD, EXK, FNV, GORO,HL, IRVRF, MUX, NCMGY, NGD, NEM, KL, NSRPF, OCANF, OR, PAAS, PVG, RGLD, SAND, SSPXF, SSRM, SILV, USAS, VGZ, and WPM will be trading for when gold goes to 5K and silver to 200 when Alexandra Oscario Cortex wins the 2024 election? God help us!
Ebenezer Barzini (haha!) – Yes if/when gold goes to $5k and silver goes to $200, then turkeys will fly, and most PM stocks will be many multiples higher. I’m just interested in seeing Gold break above $1566 and Silver to get above $21.23 for starters.
That last comment about AOC scares the crap out of me, so better own more PMs.
It really depends on what $5k means when gold gets there. If gold were to reach that level while oil and labor remained essentially where they are now, then the big cap low cost producers would be up probably 15 or 20 times while many juniors would be up more like 100 times.
Today’s high cost producers would be very appealing in that event. For example, the ones that are making $50 per ounce at $1500 gold would see their profits soar 70x, again, assuming oil, labor, etc. remained where it is today. Such companies’ shares would likely go up by that 70x or more. And if production costs were to double while gold went to $5k, profitability would still rise 44x.
You’d be Billionaire Barzini.
Minor correction: 44x should be 42x
Well if oil goes to $200 that will be good for my Shell, XOM, CVX, DVN, and SU. But if oil goes to $25 as Rambus predicted, that will goose the earning of my mining shares. But even if I make a $100 million how much will I get to keep if AOC and Warren raise the capital gains tax and income tax, and start a wealth tax? O well…
You will get to keep most of it because you are smarter than she is. 😉
I don’t know what Rambus is smoking.
Btw, like I said months ago, your COP is going much higher. For now, I’d say about $20 higher.
https://stockcharts.com/h-sc/ui?s=COP&p=W&yr=3&mn=11&dy=0&id=p67750733614&a=688414195
Merry Christmas to all, I get so fed up with being politically correct and saying Happy Holidays.
Remember the madness of 1929, This Big Bull Market hides all manner of dubious financial practices so long as prices rise. The Federal Reserve knows this and they have been throwing a huge pyramid of capital at Mr. Market. Everyone here is elated with this latest rally, but be careful when you look up at the sky, that small cloud that you see might be hiding a huge storm. DT
DT, thanks for the comment. This PM bull market will test people’s patience. Don’t get thrown off the bull by set backs. Just remember, there will be fluctuations but in the long run, the patience will pay off.
I’m far from elated about the stock market but I do think it could easily go much higher than most expect. The P&F price objective for the Dow is 35,500 and I don’t doubt that it can get there.
https://stockcharts.com/h-sc/ui?s=%24INDU&p=W&yr=3&mn=11&dy=0&id=p50463933263&a=698777475
Merry Christmas, Happy Hanukkah (celebration of dedication of the 2nd temple in Jerusalem in 2nd century, 25th of Kislev).
Historically, Saturnalia was celebrated by Pagans and Romans on dates between December 17 and 23, and Natalis Solis Invicti (birth of Sun as conqueror) was celebrated on about December 25. It was Constantine that chose December 25 as Christ-mass day in 336, shortly before he died.
Yes, many ancient deities also had a Dec 25th birthday because it is associated with the Sun’s birthday. On the winter solstice the sun dies for 3 days on the cross of the zodiac, then on Dec 25th it rises as a new sun and is “born again.” As long as the sun rises, there is everlasting life on Earth. Later in time when the Christians and Pagans merged traditions, this narrative was superimposed on the story of Jesus as well, even though most serious biblical scholars realized long ago that based on the stars in the sky at the time of the birth narrative, that it made no sense for Jesus to have been born at that time in a historical context. The dying on the cross for 3 days and rising anew was also transferred to the Easter narrative. History and religion is just one big mashup of older stories and ideas.
Remember the best and longest bull markets climb on a wall of worry.
Jeff Christian never has had a such a rise to prominence as the ongoing response he is enjoying under his banner this Merry Christmas season.
May Righteousness exalt our Nation, and a measure of Love & Peace be restored as was enjoyed a mere 60 years ago in our old US of A.
Part of QEII’s Christmas message:
Thanks CFS, THAT was quite touching out of a noble queen. Thanks as well for all the time, effort, concern & well doing as well as a lifetime well lived. I hope you come to a saving place in your heart for The Lord Jesus Christ, our highest destiny from such a great Love of mankind..
23/12/1913 ! 106 Year ! the feast of bale the federal reserve act was paste ! Wake Up Humans !
The XAU is about to close above the 600 week EMA for the first time in almost 7 years which is so surprise considering…
On December 13, 2019 at 11:16 pm,
Matthew says:
The XAU just put in its highest weekly close since August, 2016 — 173 weeks ago…
https://stockcharts.com/h-sc/ui?s=%24XAU&p=W&yr=8&mn=6&dy=0&id=p36042732043&a=544961406
The new P&F PO happens to be 136, the same as the .618 Fibonacci retracement.
That for all that you so generously offer to this gathering on KER
You’re very welcome.
Thanks
Silver tested the 200 week MA and 30 week MA simultaneously a few weeks ago just as the former crossed (bullishly) above the latter for the first time since June, 2009, over 10.5 years ago.
Silver went on to nearly triple within two years following that 2009 cross but even if the 2003 cross is closer to what we can expect, that’s still roughly a 60% advance in only 30 weeks. Either way, or even neither way, I think we are in for some very rewarding action in our miners in the weeks and months ahead.
https://stockcharts.com/h-sc/ui?s=%24SILVER&p=W&yr=5&mn=11&dy=0&id=p23650729107&a=501194637
Correction: The latter crossed above the former (30 over 200 wMA). I must have dyslexia.
As has already been pointed out on here Gold’s bull flag had a breakout in recent trading sessions. Tis the season…
https://tvc-invdn-com.akamaized.net/data/tvc_a867d899c220a447fcb4844ff07c92df.png
Looking good!
in Pre-market trading:
Gold $1509
Silver $17.92
Thursday the 26th trading session is humming right along:
Gold @ $1516
Silver @ $18.11
SILV – my 1st 60 BAGGER SINCE 2011( MFN)
Way to go Marty. Silvercrest has truly been an epic story and the fact that you hung on all the way up is commendable. Hats off to you sir and congratulations!
SILV isn’t gonna get sodomized by SSRM like Golden Arrow did.
It is interesting that today’s huge move was foreshadowed by it making a new all-time high yesterday on the TSX. It did so by one penny. It might seem funny to those who don’t look at charts but there was nothing insignificant about that penny since it showed that the move was “impulsively” strong and, of course, new highs are important to a lot of traders.
ISVLF is up 22% this week but is now at weekly Bollinger Band resistance…
https://stockcharts.com/h-sc/ui?s=ISVLF&p=W&yr=4&mn=0&dy=9&id=p75030271177&a=677775870
The daily chart is overbought but the weekly chart is just getting started so any pullback here would be a gift to buyers.
https://stockcharts.com/h-sc/ui?s=ISVLF&p=D&yr=0&mn=11&dy=0&id=p84822947831&a=677087368
The weekly MACD is just now giving a buy signal so this move probably has many months to run. Compare it to 2016:
https://stockcharts.com/h-sc/ui?s=ISVLF&p=W&yr=3&mn=11&dy=14&id=p77886239405&a=642608464
Thanks for the update Matthew. Just sitting and watching the action in ISVLF. Not selling a dime and in for the long run. After Brixton, what is next on your shopping list if anything? I assume you might be turning your attention to uranium plays like Ex and Doc.
I’m with you, not selling Impact.
Uranium does not interest me yet. I don’t think it’s time and even if it does start to rise with commodities due to inflation expectations/speculation, I don’t see a true bull market developing soon. So diverting my attention from the gold/silver miners bull seems like a bad idea to me. I don’t need more than one bull market and a bunch stories to feel good about my risk(/reward) profile.
Gold looks fantastic across all time frames from the short term to the very long term (daily, weekly, monthly, quarterly, yearly). Uranium does not.
I would much prefer to look at oil or even copper plays here than uranium plays.
The surviving 2-3 dozen Uranium stocks have the potential to go up far more on a percentage basis, when money comes back in to this tiny sector than the larger pool of Oil (hundreds of stocks) or Copper (over 100+ stocks).
I agree that the Gold & Silver bull market is in play at present and is more immediate, and have positioned accordingly.
However, the news and conclusion from the Trump administration’s “Nuclear Working Group” should hit in February or March, and there is a case to be made for positioning in the US-based Uranium stocks now while there is little interest I the sector, for a rally in the medium-term.
I’m far more heavily invested in Silver and Gold stocks for 2020, and have a few Copper or Zinc stocks for the inflation of commodity assets thesis, but have no interest in missing the pop in Uranium stocks in 2020 when we finally see a new longer-term off-take contracting cycle kick off. When that happens, the move up will be sharp and sudden, and won’t afford investors waiting on the sidelines much time to get positioned, and will leave most spectators chasing to the upside. That same severity of a surge will not happen with Oil or Copper stocks, which will be more measured increases.
Oil and copper have far better charts. Potential can remain potential for a very long time… or longer.
Matthew, I agree with you on uranium. At this time gold and silver miners look better to me. I’m glad I bought those tobacco stocks a year ago.
Small investors really don’t need to get positioned too early since they aren’t trying to buy huge positions. Also, the money you MIGHT save by buying now could be very small when compared to the gains that you’d miss in the gold and silver stocks while you wait.
I’m not a fan of diversifying just for the sake of diversifying when we’re talking about highly speculative plays. Balancing high risk versus low risk is a different story.
Bonzo, I’m not sure many people understand the special gift that is a bull market. They should be focused on and played almost exclusively if one wants truly life-changing gains.
I agree that Copper and Oil have far better charts, but neither is going to suddenly double or triple in spot price in a short amount of time. Their moves up will happen, but be more measured and they are much larger sectors. Oil is much more widely followed by analysts and the stocks are much more fairly priced as a result. Copper will take off in an inflationary environment, or if there are huge infrastructure projects announced, or the elusive Trade War resolution. The world is awash in both Oil and Copper producers and new supply can come on rather quick. The same cannot be said for Uranium production (where most of the sector is on care and maintenance).
There are are also times in any asset class or individual stock, where the fundamental drivers can temporarily swamp the technical set up and seem to come from out of nowhere…. (ie like a good drill result coming in on an explorer, or a sudden takeover of a company, or a long sought after permit finally coming in, or a sudden financing announcement, etc…)
In the case of Uranium miners, the news from the working group, whatever day it finally comes out, will be a spark in the sector, and simultaneously, will be a cue to the utility companies on which direction to go, thus kicking off a contracting cycle which will be the real brush fire. Once that starts it will draw a lot of eyeballs to the sector but the easy gains will have already happened in the initial surges.
When those fundamental drivers hit suddenly, it will also take a while to start being reflected in the longer term quarterly, monthly and weekly charts (but of course, will be evident on the lessor charts like the daily and hourly charts.)
We are likely still a few month away from that initial announcement though, so for now the clear play is the PMs for the short to medium term. Until then….. Ever Upward!
My Trading account portfolio (not my retirement portfolio) is about 70% Gold & Silver, 10% Base Metals, 10% Uranium, and 10% Lithium.
My focus is on the PMs to capture the next leg of the bull market, but as I trim the winnings down the road, I’ll be rotating more in the Base Metals and Uranium, likely taking the ratio to a 50% PMs, 20% Base Metals, 20% Uranium, and 10% Lithium ratio.
Then in 2-3 years I expect to be down to 30% PMs, 20% Base Metals, 30% Uranium, and 20% Lithium/Graphite/Cobalt.
Re: “I agree that Copper and Oil have far better charts, but neither is going to suddenly double or triple in spot price in a short amount of time.”
— — —
No, of course not. And neither will uranium or even gold and silver. But that’s not the point at all. The far superior looking oil and copper charts do point to easier big gains in the shares associated with them. A copper junior could easily triple quickly as copper rises modestly.
Sure, uranium could erupt at any time but the big picture charts suggest that nothing big is coming soon. I think I’d rather trade AMZN.
My tune could change sooner than I expect, and if it does, then some uranium juniors will become gold/silver profit dumpsters.
Uranium has been trading at $25 lb in the spot market prices (which is far below most traditional longer term contracts in the $50-$100 lb price point).
When the contracts do get negotiated higher the spot price of Uranium will move from $25 to $50 in very short order (doubling) and many believe the contracts will need to move up to the $60-$70 price point to incentivize the hard rock production to come on-line (which would be a tripling of the stock price).
The Uranium miners are projected to move up 20-30 times on a move like that in the next few years.
Copper is not going from $3 to $6 or $9 and Oil is not going from $60 to $120 or $180 was my point.
correction to that post above – Doubling or tripling of the (Spot price) – not the “stock” price. Unlike Copper or Oil, yes, Uranium can double or triple in price in very short order. Maybe late 2020 for a doubling in commodity price, and 2021 or 2022 for a tripling of price. That is fairly unique aspect to uranium in the energy sector.
The U stocks will be going up many many multiples higher. In the last uranium bull many went up 30-40 times, and a big part of the gains were in the initial thrusts higher.
Ex, those future uranium prices are not a done deal. The superior charts of oil and copper ARE a done deal. I’ll take charts over stories every time. A lot of people thought uranium was going much higher years ago.
The potential returns in the Uranium stocks dwarf any other sector I’m aware of for the coming commodity and energy sector, but granted they are the highest risk and biggest contrarian plays there are in the resource sector.
Again, I agree that Gold & Silver are the less risky bets for the immediate and medium term gains and I’m weighted 70% toward them for just that reason.
The diversification into Uranium stocks is not for safety, or to miss out on the PM bull, but rather to capture the larger gains that Uranium stocks will offer when they do start to move and may outperform the move in PM on a factor of 2 or 3 times as much for those positioned early.
I agree with you that there is always the potential for opportunity cost while waiting for the sector to move (when there are gains to be had in the PMs) but a 10% allocation to Uranium stocks seems appropriate and in proportion to have a fishing pole in the water to capture the initial thrust upwards, and then if things really start popping to grow that allocation when the volume starts showing up.
Maybe I’ll change my tune though, and wish I’d allocated 80% to PMs in 2020 instead of 70%. I’ve caught a few nice 200-300% runs in Uranium stocks in early 2017 and early 2018 from when the Uranium spot price moved from $17-$24 that give me confidence we haven’t seen anything like what we’ll see when the contracts push the U price back up to $50-$80+. Until then it’s only 1/10th of my focus and portfolio, and while it may languish, and cost me potential gains, that’s gamble I’m willing to take.
Matthew – I hear you, and agree that PMs, Oil, or Copper have the better charts, and in general agree that it is better to side with charts over stories.
However, those aren’t just stories, those are cost of production numbers. Most insitu miners need $40-$50 after reclamation and mitigation costs are factored in, and the hardrock miners need $60-$70 for all in costs. The few contracts that have been signed were in the $50’s. Those aren’t stories, they are what has been put under contract, and well understood industry cost profiles.
It is no different than most Gold companies needing $1,100-$1,200 to make a profit when all in costs and cost of capital are all factored in. Now imagine that Gold was only trading at $400-$500 in the current environment. It wouldn’t be a story, but a harsh reality that the price of gold would need to double or triple from $400-$500 to work in today’s mining cost environment and while it wouldn’t be guaranteed, the cure for low prices would be low prices.
That is precisely where Uranium is today. It’s bear market actually has been since 2011, and was far worse, for more severe, and far more destructive than the bear markets in Gold/Silver, Oil, or Base Metals were by a huge margin, and the upcoming bull market will be more extreme to the upside as a result.
As so many have stated that follow the Uranium market closely, “Either the spot prices go back up above price of production or the Uranium market collapses and the lights go out.”
Uranium provides 10%-20% of the baseload power in many developed countries, and it is crucial to the energy mix, and the stockpiles of Uranium have been absorbed post Fukushima, the Dept of Energy finally quit dumping Uranium and Plutonium into the spot markets under the Trump admin with Rick Perry at the helm of the DOE, and the Russian underfeeding from old stockpiles has finally been used up. The next contract cycle is about to kick off, but utility companies are waiting until the working group comes out with their decisions to know if they’ll have domestic US quotas, or tariffs, or subsidies, etc…. Once that is flushed out, then the new contracting cycle will kick off. Feb/Mar is the timeframe most are watching for, and people will start positioning in front of that in Q1 2020.
Ex, there’s not much reason to draw parallels between gold and uranium that I can see. The two couldn’t be more different in terms of their risks and drivers. “Needing” a certain price to mine at a profit doesn’t guarantee anything by itself. More info is needed and so many are so biased to the bullish side that I’d look hard for bearish arguments before the bullish ones. Many are already high on gains they don’t yet have.
“Although reactor requirements are rather flat through 2025, there is significant growth over the 2026 through 2035 period that will necessitate new production. Furthermore, there are a handful of uranium projects whose resources will be exhausted by 2025. In addition to transitioning to a more production-driven market, a large percentage of production exists in regions of the world with higher geopolitical risk, making the market vulnerable to future disruptions and price volatility.”
https://www.uxc.com/p/products/rpt_umo.aspx
It has been a long wait in the Uranium market, and I really though when the spot price double-bottomed on the longer term in late 2016 and again in late 2017 at $17, and the miners surged in early 2017 and again in early 2018 that the sector was lifting off.
However 2019 was dominated by the Section 232 petition and stalls and then starting a 90 day working group, that needed 30 more days, and then now needed 90 more days. Is it possible they stall again? Sure; but the uranium miners are coasting on fumes, the utility companies are pissed this decision is taking so long, and if they stall again, the whole industry is going to chit a brick.
I’m sticking my neck out here, but I’m convinced after following this sector every week for a decade that we’re near a new contracting cycle that should kick off by the end of Q1 or at least by Q2 2020. It will then pick up momentum over the next 18 months after the first contracts get set up.
I’ll stop ranting now, and am not offering investment advice, just my own perspective as someone that keeps very close tabs on the industry. The entire energy sector – be it Oil, Nat Gas, Uranium, Lithium/Cobalt, Renewables, all look poised to keep heading higher, but my pick of the litter for the next few years is Uranium hands down. The only thing that would derail that thesis is if they ever get Thorium reactors or Fusion reactors going, or if there was some other global catastrophe that killed it for good.
Until then…. I’m 1/10th in position, watching and waiting.
Matthew:
Would it be an imposition for you to explain what you mean when you say you’re not selling Impact? Obviously I understand the meaning in the short term but let’s say in a year or so………..If Impact passed $1.00 would you still be expecting a lot more? Appreciate whatever input you have……….Thanks
SilverDollar, that was in reference to the short term overbought condition which would typically cause me to do some selling. Since the much more important weekly chart is just now turning very bullish, I have no desire to sell any for short term reasons and would rather sit through whatever pullback might come.
Future selling will be based on multiple currently unknown factors rather than a price target that I might have in mind today.
I think the next intermediate top will be well above $1.00 but that opinion could change in the weeks ahead. Wherever the next intermediate top occurs, I am currently very confident that it will not mark the end of the bull market. Of course we all might think otherwise during the ensuing correction.
The P&F price objective is still $3.50 for IPT and I think it will get there (and beyond), the question is when.
I obviously have good reason to be more confident about this call from 13 days ago:
On December 13, 2019 at 10:31 pm,
Matthew says:
Despite the last two left-translated cycles and Bollinger Band resistance (.45 monthly and .47 weekly), I see it taking out .51 no later than January.
As a group, the silver stocks put in their multi-year (post-2016) low about 8 months after the gold stocks so they are well behind in presenting a more bullish technical picture and the more speculative juniors are even further behind. But the action in SIL and SILJ since mid October shows that the silver stocks are shaping up very well and the very recent action in IPT shows that it is not excluded from this bullish development. The huge volume of the last two weeks is very unlikely to be the result of dumb money buying considering the current sentiment and the price drop since early August.
https://stockcharts.com/h-sc/ui?s=ISVLF&p=W&yr=3&mn=11&dy=0&id=p24448571309&a=642610362
GDX/GDXJ and SIL/SILJ have essentially filled their morning gaps and are moving up again.
Thanks for your collective thoughts. I have plenty of silver junior miner exposure including ISVLF, AXU, USAS, ASM, DOLLF and of course Brixton. I also have some Millenium and some CDE. I have more silver miner than gold exposure at this point given the relative value of silver vs. gold.
We see things very similarly as I also have more silver exposure than gold.
Good list of companies Charles. I’m right there with you with positions in Impact, Alexco, Americas Gold & Silver, Avino, Dolly Varden, and Brixton.
However, for the Silvers I also hold First Majestic, Silvercorp, Endeavour, Excellon, Santacruz Silver, Discovery Metals, Metallic Minerals, Kootenay, AbraPlata, Aurcana, Defiance, and Orex.
I also have a some Silver exposure in some base metals plays like Trevali, Sierra Metals, Tinka, or Gold miners like Mandalay, Sabina Gold & Silver, and a few others.
Cheers and good luck to the Silver wingnuts in 2020!
Have to say I was disappointed with the price action in Alexco and America’s Gold today in relation to gold and silver today
Try this again. No idea where last attempted post went. Little disappointed with Alexco and USA today in relation to the move in gold and silver today.
I wouldn’t worry about today’s performance. It’s just bears and nervous bulls selling near the 2016 and 2019 highs. The whole sector experienced such selling today but I think it will finish the week on a high note to secure the weekly chart MACD buy signal.
https://stockcharts.com/h-sc/ui?s=AXU&p=W&yr=4&mn=11&dy=0&id=p69031592891
Sellers are gunning for Tuesday’s gap but I have a feeling it will remain open.
https://stockcharts.com/h-sc/ui?s=AXU&p=D&yr=0&mn=11&dy=0&id=p79484227970&a=709369195
I don’t own it but I think you will do extremely well with it.
Thanks Matthew….was just disappointed after a crappy day at work where I thought at least I’d get home and see some green on the screen.
Hi Wolfster – I agree that Americas G&S and Alexco weren’t as strong today in their closing prices (which is still only 1 day) but they were up far more intraday, if investors were swing-trading them. Eventually some miners just had investors cash in, while their was strength & liquidity, as their was large volume mid-day and then an increase late into the trading session.
This is precisely why I like a basket of stocks because many of the Gold and Silver companies were up 5-10% today. Look at fellow Silvers like Bayhorse up 22%, Arizona Silver up 17%, New Pacific Metals up 11.45%, AbraPlata up 10%, Silver One up 7%, Defiance up 7%, MAG up 7%, Silver Bull up over 6%, Aftermath up 6%, Impact up 5%, Silvcrest up 4%, Avino up 3%, Aurcana up 2%, Dolly Varden up 2%, etc…
There were also plenty of other Silver companies flat to down today. Bear Creek, Silver Bear, Bitterroot, Blind creek, Bunker Hill, Santana, Orex, were all flat 0% on the close today.
Kootenay was down almost 2%, Sierra Metals was down 2%, Maya G&S as down 2 1/2%, Goldplay exploration was down 2 1/2%, Minco was down about 6%, and Santacruz Silver was down 6% on the day.
I wouldn’t read much into the weakness at the close, as it was profit takers, or top callers trying to start shorting the recent thrust higher in the miners.
USAS was down less than 1%, and AXU was still up 1/2% today, so there wasn’t terrible weakness for any fundamental reason, and they just underperformed on the day. Alexco has been ripping higher lately, so a day of rest makes sense as many are trimming their winnings, and more power to them for cashing in on a winning trade. I’m holding through all this because both Americas Gold and Silver and Alexco are about as solid an option for higher Silver and Gold and Zinc/Lead as one gets and I spend little time worrying about their big picture thesis or performance in the unfolding PM bull market.
I just reread this post and realized it says “their” instead of there” in a few places that I didn’t notice in that rambling response… damn voice to text. Also, I really wish we could see more than 4 lines of text at a time in the posting window, as once they move out of sight, it is hard to give things a quick glance before hitting submit.
Ex, you can see as many lines as you want. Just go to the lower right corner and left click on those two tiny diagonal lines and drag them down.
My goodness… I’ve been looking for that feature all these years and never knew what that those little lines in the bottom right hand corner were for.
Thanks.
For years!!! never knew that.
Thanks gentleman….as I said I was in a pissy mood…a good friend wanted me to clean up the doors and frames at his place. Turned out they were painted in latex straight over oil with no special primer so I have strip them all down to base coat of oil,sand and prime properly and repaint. I only glanced at the gold and silver price occasionally throughout the day.Totally expected to see them up when I got home all tired and achy from a hard days work……..and did you have to mention/remind me Kootenay was down. Lol
Wolfster – sorry to hear that about the paint job antics, but hopefully you saw that USAS was up 3% today. AXU was still down 2% but it’s still working off the recent surge it had.
Cheers!
Charles, I love the look of the long term chart on AXU—over time, I feel you should do very well with that stock.
Thanks Doc. I am hoping AXU has a similar or even bigger run than it had in 2016.
+2020 Alexco has been thriving lately and it makes sense as they are blazing towards production in under a year, and keep making more and more amazing Silver discoveries. They just found another new blind deposit next to Bermingham under cover, and their exploration team believes they now how the magic sauce for finding them all over Keno Hill.
I’m just hoping the team at MMG Metallic Minerals (their neighbors) are taking good notes. 🙂
(AXU) (AXR) ALEXCO DISCOVERS NEW ZONE OF SILVER MINERALIZATION, 3.7 KILOMETERS NORTHEAST OF BERMINGHAM DEPOSIT, COMPOSITE ASSAYS TO 832 GRAMS PER TONNE SILVER OVER 7.4 METERS TRUE WIDTH
December 4, 2019
Ex, thanks for the info. AXU is one of my largest positions and I’ve had it for years at a nice low cost basis. I think we get a small pull back and I may add to my position. I think this stock is in for a large run over time.
Thanks Doc and agreed. I’ve been invested in Alexco since 2016 and have traded around that position about a dozen times raising or lowering my position size in it, but I’ve been on steady accumulate on the dips since later in 2018 and follow the fundamental status very closely and remained very impressed with all their Exploration and Development results.
Alexco continues to deliver over and over and over again with the drill bit, and keeps increasing the size of their deposits and finding new areas and blind discoveries. It’s all very impressive to see their continued success in an industry that fails so often. It’s a longer term hold for me at least until they get their production going for 2 years or so.
Doc and Ex – if I were to sell or reduce my silver exposure in one of the above silver miners to add to AXU on a pull back which would you choose? I was thinking CDE as it has gone on a nice little run here, but expect it will underperform going forward given it’s size. Also what are your guys thougAUG
CDE appears to be stalling here due to monthly Bollinger Band resistance at 8.15. It has also reached significant “2018” resistance:
https://stockcharts.com/h-sc/ui?s=CDE&p=W&yr=3&mn=11&dy=0&id=p43737683007&a=541041866
I don’t own it but I really like CDE for its leverage to silver. With its $1.9B market cap, it is very liquid yet still moves like a GOOD junior. It easily outperformed AG/FR.TO in 2016 and is a solid long term buy now on pullbacks. The weekly chart suggests that it won’t stall here for long and the monthly chart points to huge potential upside.
Thanks Matthew. The “sitting” is the hardest part!
In 2016 First Majestic and Coeur were not the same companies than they are today, but both are highly leveraged to Silver, and AG was an 8 bagger and CDE was a 10 bagger so they both did great, like smaller Jr companies. First Majestic also had a nasty short-sell attack against it from that coked-up wack-job over at Kerridale Capital, that proved to be unsubstantiated, but it hurt the stock right at the peak and down the other side of the pullback.
Keep in mind that in late 2015 First Majestic had just finished taking over Silvercrest’s Santa Elena project and hadn’t really got it up and running on all cylinders until later in the year once the PM surge had topped out, and it didn’t acquire Primero for San Dimas until January of 2018, which was a game changer for their production profile. They also poured a bunch of money into optimizing some of their older mines in late 2018 and through this year, so it’s asset base and production profile are far more robust now, than they were in early 2016 when the PM bull kicked off.
Coeur sold it’s Joaquin Project to Pan American in 2017, along with it’s Bolivian subsidiary Empresa MineraManquiri, S.A., but picked up the Silvertip mine. Those last 2 transactions were dragged out into 2018, and CDE acquired Northern Empire in 2018 (where I became a short term holder of Couer because I owned Northern Empire, but sold my position in CDE to get back into smaller market cap Jrs).
Either AG or CDE are solid companies and both will do well, but I’d be careful extrapolating out 2016’s performance and applying that to which will move more in 2020.
Charles to answer your question, I’d likely divest Avino before getting rid of Impact, Alexco, Americas Gold & Silver, Dolly Varden, or Brixton, as ASM has been underperfoming the rest on each of the rallies (2016, 2017, 2018, or 2019), and they just sold Bralorne, which represented a big piece of the upside leverage they had for this coming cycle.
May your investing be prosperous. Ever Upward!
Ex, I’d be careful assuming that I’m just extrapolating. Notice that CDE has kicked AG’s ass since May as well? The reasons for CDE’s leverage to silver are obviously still in place and it still moves like a GOOD junior.
Yes, both will do very well and who knows which will ultimately be the best performer, but I’d prefer to bet on CDE rather than the overly loved/hyped AG.
In the near term AG might do some catching up since it has lagged and is not nearly as extended/overbought as CDE.
Like I said earlier, I’ll take charts over stories all day every day.
Btw, I do agree with selling ASM to buy AXU but I don’t think Charles was considering selling AXU to buy AXU. 😉
Duly noted.
Thanks guys.
MUCH bigger in my estimate for the coming bull.
Agreed. The 2016 run in Alexco and most of the precious metals miners, was really just the appetizer, and we are gearing up for the main course in 2020 and 2021. We then will have a corrective move, and come back to the well one more time for dessert in 2022.
China Copper Smelters Raise TC/RCs Citing Output Cuts -Sources
Tom Daly Reuters – Dec 26, 2019
“China’s top copper smelters on Thursday raised their floor treatment and refining charges (TC/RCs) for the first quarter of 2020, arguing that cuts in production meant there was less demand for copper concentrate, according to two people with knowledge of the matter.”
“Copper miners pay TC/RCs to smelters to process their copper concentrate into refined metal. Charges go down when the market tightens and rise when ore supply is more abundant. The 12 state-backed members of the CSPT are supposed to adhere to the floor charges in any spot copper concentrate deals.”
Despite the sluggish Copper market, Regulus is one company I’ve positioned in due to their depressed share price paired with a really quality asset and team that has been delivering in a tough Base Metals market.
They have a large lower grade bulk mining open pit scenario that has all the indications it is developing into an economic mine.
They just completed a nice capital raise when money is scarce to move things forward in 2020 and expand their resources, improve the economic studies.
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(REG) (RGLSF) Regulus Announces Closing of C$11.5 Million Financing
by @nasdaq on 27 Dec 2019
“The net proceeds of the Offering will be used to fund exploration and development activities at the Company’s AntaKori project, for working capital, and general corporate purposes.”
“Regulus Resources Inc. is an international mineral exploration company run by an experienced technical and management team. The principal project held by Regulus is the AntaKori copper-gold-silver project in northern Peru. The AntaKori project currently hosts a resource with indicated mineral resources of 250 million tonnes with a grade of 0.48 % Cu, 0.29 g/t Au and 7.5 g/t Ag and inferred mineral resources of 267 million tonnes with a grade of 0.41 % Cu, 0.26 g/t Au, and 7.8 g/t Ag (see press release dated March 1, 2019). Mineralization remains open in most directions and drilling is currently underway to confirm and increase the size of the resource.”
https://ceo.ca/@nasdaq/regulus-announces-closing-of-c115-million-financing
Some of the PM charts are looking stronger as we move into the new year. Hopefully, it’s not just an end of the year rally that then reverses early January. It is encouraging though.