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If there's a $10 buyout, I'll get a BAA tat on the back of my jewels.... Just kidding. LOL
Published on Gold News (http://goldnews-cms-en.bullionvault.com)
Home > Gold Miners: This Time Is Different
Gold Miners: This Time Is Different
Thursday, 10/22/2015 11:33
But only a little, and only with caution still flagged...
The TITLE does not include a question market, and that is for a reason, writes Gary Tanashian in his Notes from the Rabbit Hole [1].
The gold sector's fundamentals, both sector-specific and macro, are improving. This was not the case during the last exciting upturn in the sector circa summer 2014.
Back then, everything from Russia's move into Ukraine to the Ebola scare were imagined to be sound drivers of the gold price. This stuff proved, as expected, to be wrong when the whole complex made new lows in November of 2014 (prior to this year's ultimate lows).
What is driving gold and the gold sector this year? The things that we have been saying for years now would be needed.
Gold rising vs. commodities: Indicates a counter-cyclical global economic atmosphere (engaged)
Gold rising vs. stock markets: Indicates an environment in which mainstream investors would be motivated to consider the sector (constructive, not yet engaged)
Gold rising vs. global currencies: A self-explanatory indicator of waning confidence (constructive+)
Declining junk/quality bond spreads: Indicates waning confidence in the financial system and those who have propped it up (engaged)
Economic contraction as presented in mainstream economic data releases (constructive, not yet engaged)
Treasury yield spreads rise: Indicates risk aversion to systemic stress, whether inflationary or deflationary and waning confidence (10yr-2yr inconclusive as of yet, 30yr-5yr engaging)
There are more details, but the above would paint a picture of a counter-cyclical environment, which is the investment environment for gold and would set quality miners up for a big rally or bull market.
Dial back to this past summer. Back then (on July 17) the Wall Street Journal called a bottom on gold exactly 1 week before it made its low at $1072 with its story Let's Be Honest About Gold: It's a Pet Rock [2].
This was not a bunch of lunatics fighting each other for the right to get on the soap box and rally the troops to buy gold and hide in their bunkers for fear of the Russian horde. That and the Ebola headlines were so contrarian bearish it was palpable.
No, this was a classic bullish contrary indicator and most recently as the HUI index of gold-miner stocks dropped to the long-term Head & Shoulders target of 100 (101 and change) we watched it scrape along the bottom of its downtrend channel for signs of a bounce, noting that the fundamentals were firming and aided, not hurt by the media this time.
Here is the linear scale chart NFTRH used to gauge this possibility last summer for subscribers, even as log-scale charts were put forth on the internet showing a breakdown below the channel for the relatively new cottage industry in gold bearishness to consider. Not this time boyz.
As you can see, it was touch and go at the channel bottom for weeks and I am not going to pretend to have been a resolute gold-stock bull during that process.
Indeed (and hear this clearly), gold stocks are in a bear market, technically speaking. They are technically in a bear market even if they are in a bull market because not even the first technical milestone has been accomplished; nor would or could it be at his juncture.
But again, it is different this time because sector and macro fundamentals are either in line or slowly creeping in the right direction. You probably don't need me to tell you that there is going to be some turbulence ahead, whether HUI gets to what we are still calling its "bounce" target in the 150s first or not. But the nature of the sector is much improved from a fundamental standpoint, both sector and macro.
The gold sector has been on a technical bounce that we have anticipated since mid-summer and managed since September. With sentiment getting over bullish and Commitments of Traders data putting a bull's eye on silver lately, the ingredients were in place for a negative reaction. Now it's come, it will pay for players to have their fundamental ducks in a row, unlike in summer 2014.
Many people know me as a chart guy but I am here to tell you that it is the fundamental backdrop that will be for all the marbles. The charts right now, bounce aside, remain in bearish trends for gold stocks (aside from a few little gems bucking the trend), gold and silver. We are following these trends consistently in NFTRH, but just as consistently we are keeping tabs on sector and macro fundamentals, which would lead the technicals just as most of the fundamentals noted above did in Q4 2008, only it was in quick time...like 100 times faster than today's situation.
Bottom line? The gold sector has been bouncing and this time it has a fundamental right to do so. The sector is in a bear market but the elements are aligning to end the bear. It is time to know what to tune out and what to take in when managing the process.
The negative reactions will come and only a clear view considering sector and macro fundamentals and technical analysis will define whether and from what levels those are buying opportunities.
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Source URL: /gold-news/miners-different-102220151
Links:
[1] http://biiwii.com/wordpress/2015/10/16/gold-stocks-different-this-time/
[2] http://blogs.wsj.com/moneybeat/2015/07/17/lets-be-honest-about-gold-its-a-pet-rock/
Idk dude. Stocks go up, then they go down. Let's see what happens.
Low Volume.
No, why do you say this?
Gold up right now.
Buy/Sell Vol looks interesting. I decided against selling today. GLTA
Gotcha. What made you sell?
Aeropostale is trying to generate more money by Opening stores in places like Ireland. Ireland's currency is the Euro, correct? Smart move. Create opportunity elsewhere. Not to mention the possible boost in sales. I'm sure ARO likes throwing around they are U.S. based est. 1987 in Foreign countries.
I don't understand what you mean. BAA is up. Other mining stocks may be down (Slightly), but the Buy/Sell volume tells a different story about the direction they are heading. POG is what keeps the lights on. Not the performance of other company's common stock.
I don't believe in this selloff. Chart looks weird.
POG is up, so is BAA.
You Shorting this one?
ARO, now is the time for Form 4s. Strike while the iron is hot. LOL
I don't listen to him. I don't listen to anybody. That's never a good idea. This is a place to share ideas & analysis with one another. Believe it or not, companies read boards like these. In one of my courses back in college, my instructor mentioned examples in history of public companies going to the boards. Just another purpose they can serve other than investors making claims or predictions.
He called his shot like babe Ruth on ARO.
He called his shot like babe Ruth on ARO.
Although, I have to admit.... keyotee is usually pretty accurate on his predictions. I could see a pullback happening to .1740 just for him to be like, "I told you so" lol.
Although, I have to admit.... keyotee is usually pretty accurate on his predictions. I could see a pullback happening to .1740 just for him to be like, "I told you so" lol.
Is it real? I've been waiting....
Are you kidding me? Lol. Only 2 things will shoot this undervalued gem to $1.00.... results and high gold prices.
EW theory is pointless with gold. Pay attention to POG and world influences. IMO.
I already bought.
Almost 500k Shares traded in the last 30 min! wow. This one is gonna be a winner.
He still has a following. Let them help run this thing up. I'm not complaining. Smart money will stay.
Thanks for giving us a Shoutout, Clay. Lol Although, I dislike how you forgot to factor in the volume on those candles. The price was moved down from low volume around 1.00..... I gotta lean towards the resistance being somewhat higher.
And it's not a deadbeat bounce. ARO is starting from scratch. Making agreements overseas, hopefully their brand is strong enough to sell. Bigger margins, bigger gains.
That's kind of what I gathered while sorting through old news articles.... While it gives much skepticism, I believe the Share price already reflects the reluctance. Once commercial begins, it should be when gold is back on the rise. Thoughts?
ARO looking like a good long term pick. IMO. High volume EOD near HOD of .70..... Looking good.
What's the deal with this Namoya mine?
Agreed
Saw 1 trade go through earlier for about 187,000 shares. Was around noon
100k trades within the last 10 min of the bell. This thing picked up steam today. Could've been a stronger close. Needs to get to (at least) .68 tomorrow.
That was quite a year for the Red Sox.... Just remember one thing, the goat's name was Murphy.
I'm looking at NBG. .89 is holding up, lets see how long.
I have tickets to game 5. So If they win tonight, I get to watch them lose the series. Knowing my luck, they won't get swept. Lol
I'm not ruining your dreams, I'm just speculating. The stock needs a correction at some point. Now looks to be the time.
And I'm just going to pretend I didn't read your comment about the cubs.
Intraday shows the Uptrend appears to be over.
Premarket looked like it. Should test .68 at some point today. Jmo