without a deal to raise the borrowing limit by 2 August 2011 -
US Debt Ceiling -
Shona Mashona Masonic Golden Key -
Gold mining stocks not only track the price the gold, but they move proportionally higher relative to the current price of gold (and lower if gold price moves down).
So in a manner of thinking they are like option plays on the price of gold without the expiration date.
Note that we are talking about the trading characteristics of a commodity. The price action tends to be characterized by sharp emotional moves and spikes with excited peaks. Gold and gold mining stocks tend to trade and move like small stocks. Keep in mind though that they can still trend in bull markets. You only have to look at the chart above and observe the bull market from 1969 to 1980.
In Chart below, notice the extremely sharp price moves after some base building formations labeled as 1 and then the peak of the moves labeled as 2.
Also note the volume surges - this is what technicians call base building.
Remember bases always take longer to form than tops - the more base building the higher the moves -
What do you conceal? All the secrets which have been intrusted to me. Where do you conceal them? In the heart. Have you a key to gain entrance there? It is a tongue obedient to reason, it speaks in their absence, as in their presence.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.