Accumulation Follows Capitulation As Day Follows Night in Junior Mining Sector

I have been expecting a major long term bottom in the precious metals after major capitulation. The liquidation may have occurred this week as investors sold out of panic and fear rather than take a look at the long term fundamentals. Across the board many of the weak hands had to sell quality assets for pennies on the dollar. Smart resource investors expecting capitulation have had some of their bids filled at ridiculously low prices. Fortunes are made by the brave who pick up real assets when the majority is not interested in them. I expect a major bounce at 2008 credit crisis lows and the 2003 breakout on the HUI Gold Bugs Index at $150. I told my premium subscribers I was buying Pershing Gold (PGLC) at major lows at or below $.30. I believed that the company was due to break its downtrend and 50 day moving average. Now a few weeks later it appears Pershing has broken above the 50 day moving average and has broken out on a relative strength chart versus the Junior Gold Miner ETF (GDXJ). See charts by clicking here...
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Uranium Spot Price Breaking Out, Junior Uranium Stocks Ready To Bottom?

The commodity equities are selling off as The Fed halts QE3. Commodities, metals and the junior miners are hitting multi year lows and falling below 2008 credit crisis levels. This is not a time to panic but continue to accumulate as the bear market may be reaching the final capitulation stage. This decline may be a sign that the quantitative easing may have lifted stock market indices, but it did little to improve demand and growth in the economy reflected by demand for energy and metals. I just returned from the New Orleans Conference which was headlined by Alan Greenspan the former Federal Reserve Chairman from 1987 to 2006. It is interesting to note that Greenspan has become bullish on gold. He believes that quantitative easing did not accomplish what it was designed to do. It helped lift the stock market and stabilize the real estate market, however it fell short as the US economy is not really recovering like it should have. Gold is the best hedge against this uncertainty.
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Chart Shows A Potential Double or Triple in the TSX Venture

Clearly, the strong global economy purported on CNBC has not yet been reflected on the TSX Venture Exchange yet. However, that may change over the next 3-5 years and now may be the time to buy up the best resource assets at historic lows. Over the past decade, The TSX Venture has at least doubled or tripled from these historical low levels where it is currently trading.
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Gold and Silver Still In Major Uptrend On Long Term Charts

The Chinese and Russians were some of the largest acquirers of physical gold. Also large hedge funds some managed by industry giants such as Paulson, Soros, Rogers and Einhorn began buying ETF's and junior miners. This led to a parabolic and overbought move in precious metals, which I cautioned my readers about in the referenced article above. It should be noted a few days after this article was published silver topped at $50 and gold rolled over a few months later at $1900.
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Toll Milling in Mexico Could Generate Near Term Cash Flow

This junior miner just announced that they secured a 100 metric ton per day flotation plant which will immediately be used to offer toll milling to other miners in the area. At the same time revenues from milling could provide cash flow to develop the Las Cristinas Project where they are hitting on excellent drill results.
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Why These 2 Junior Miners Tripled in 2014 Despite TSX Venture Decline

After a great start in 2014, the TSX Venture which is the index largely comprised of junior miners has headed into negative territory in 2014 down 2% in 2014.  Don't be surprised to see the US multinational corporations face headwinds from dollar strength.  Already the Homebuilder ETF (XHB) is already rolling over and breaking below the 200 day moving average as US real estate becomes more expensive for overseas investors.  The financials could be the next one to correct. The rising dollar is putting pressure on commodities priced in dollars.  Gold and silver is struggling in new low territory.  However, some US focused mining assets critical for domestic manufacturing and industry could actually be an area of strength. Despite the major dollar rally and selloff in commodity related mining stocks, two of our featured companies have done exceptionally well this year up 308% and 231% in 2014.
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Strong Accumulation May Follow Selling Capitulation in Junior Gold Miners

Look for huge volume and accumulation in gold and silver and the junior miners over the next few weeks and in some high quality junior mining stocks. Selling capitulation followed by strong accumulation could be the indicator that the smart money expects gold and silver to bottom. The question for many is when this will occur. Do not forget we are seeing increased interest into the junior miners with oversubscribed financings. What is driving this investor demand for junior gold miners when gold and silver are testing and hitting new lows?
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Uranium Price Creeping Higher on Geopolitical Instability

A few months ago, I believed uranium would bounce off lows and make a powerful move higher. The spot uranium price is beginning a rebound rallying more than $3 per lb over the past few weeks. End users of uranium are concerned about geopolitical stability and are actively looking for safe and long term secure supplies of U3O8. Any hiccup in production could significantly impact global supply. Although there is abundant amounts of uranium in North America and Australia most of the production comes from unstable areas such as Kazakhstan, Niger and Russia. The recent sanctions with Russia could have a major impact on pricing. Russia through Rosatom operates Kazakhstan production which is the largest supplier of uranium to the world. Europe and the US are some of the largest consumers of nuclear and have relied on cheap Russian uranium for decades. What happens when the cheap uranium runs out especially at a time when demand is growing? A price spike with triples and quadruples in the junior miners.
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Junior Miners Holding Long Term Support, Bouncing Off 200 Day Moving Average

Despite the shorts in precious metals reaching record heights, the junior gold miners (GDXJ) continue to find support at the 200 day moving average, a critical area of long term support. This may be signaling to investors that gold may soon bottom around $1200 and that the major miners may start looking for economic deposits to replace current resources that are being exhausted. If you find quality gold properties near majors with top notch management with track records then you have a good shot to make a profit even through this historic bear market. For instance, about a month ago I sent out a report that the "Smart money is looking at the Cortez Trend". I highlighted a small junior company which just attracted one of the best mining explorers in the world to its board...
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Uptrend in Junior Gold Miners Forecasting Bottom In Precious Metals

The Post Labor Day rally in precious metals I expected has turned into the Post Labor Day Selloff for precious metals and many mining stocks.  Many investors came back from Labor Day and sold their precious metals in favor of the U.S. dollar.  This could be the worst possible trade right now.  This could be the shakeout before the breakout in the precious metals.  Generally this is a seasonally strong time for gold and silver.  We may bounce off new lows below $1200. Despite gold testing new lows, the junior miners are still in an uptrend since December of 2013.  Is the outperformance of the junior miners indicating that gold may bottom here around $1200?
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