Category Archives: Latest Commentaries

Why Precious Metals, Uranium and Rare Earth Miners May Outperform in 2013

Why Precious Metals, Uranium and Rare Earth Miners May Outperform in 2013
To paraphrase the great trader Jesse Livermore, “We must be like a merchant who foresees future demand, purchases his line and patiently awaits for profit taking time.” Investors in wealth in the earth assets should listen to Livermore’s wisdom. In due time, these commodities which are low priced will come back into vogue. In order to be right in the market, the majority has to believe you are wrong. Great investors like Livermore and Baruch were able to have confidence to hold on even when the positions were not popular.
Read more

China Markets Breaking Out Into New Highs May Boost Commodities

China Markets Breaking Out Into New Highs May Boost Commodities
For months, we have been highlighting to our readers that China’s economy is beginning to pick up which could positively influence commodity prices. The fears of a slowdown were overblown. China's stock markets (FXI) have been rallying since early September because speculation is rising that the newly chosen Communist Party may boost the economy and is approaching a major 52 week high breakout.
Read more

Will Japanese Election Spark A Rebound In Uranium?

Will Japanese Election Spark A Rebound In Uranium?
One sector where we see a great amount of value is the uranium miners (URA) as The Chinese are going full speed ahead in building next generation nuclear reactors. The uranium spot price is just over $40, which is near the bottom of its three year range. Uranium may represent a bottoming situation. Look for a reversal in the near term and break above the recent downtrend due to the following reasons.
Read more

Gold, Silver and Platinum Near Major Breakout Points

Gold, Silver and Platinum Near Major Breakout Points
We are approaching the end of the year where investors are facing a confluence of mixed signals such as tax loss selling, fiscal cliff discussions, the Greek bailout, future Fed actions and Middle Eastern geopolitical turmoil. Short term shakeouts like yesterday's early morning drop in precious metals should be expected...Nevertheless, we ignore the daily volatility and stick to the long term technicals and fundamentals which may be signaling that gold, silver, pgm's, uranium and heavy rare earths may reemerge as sectors where opportunity lies in 2013.
Read more

Gold and Silver Outperforming General Equities For The First Time Since 2011

Gold and Silver Outperforming General Equities For The First Time Since 2011
We have become a nation of debtors. Between mortgage, student loan and credit card debts the average citizen owes over $50,000. To a certain proportion of our nation free and easy fiat money may well be the way to go in the short term. Eventually, the piper must be paid. We may have to face one day that the party is over. Our large creditors such as the Chinese are already looking to diversify away from U.S. debt and the dollar. Our critics have felt that our patience with precious metals positions are not buy and hold, but buy and hope. So far our long range charts signal that gold and silver are in a continuing bull market, which are sometimes obfuscated by a concentration on the short term tactical decisions. The technical picture reveals the opposite. Gold is outperforming and may continue to decouple from the equity markets. Remember inflation and uncertainty is bullish for precious metals and bearish for the general equity market. Are we beginning to witness this phenomenon?
Read more

Corrections In Gold And Silver Could Provide Buying Opportunity Before Election

Corrections In Gold And Silver Could Provide Buying Opportunity Before Election
This volatility in precious metals and mining equities while striking panic is just a test to shake us out. This is precisely a time not to be concerned. The more sophisticated buyers may be taking advantage of the situation to hold on and indeed add to positions for those who were not able to get in before this summer breakout. Remember, bull trends in gold and silver rise on walls of worry. Healthy pullbacks afford secondary opportunities. We may be basing and bottoming right now. A powerful reversal could occur after the election.
Read more

Why The Large Miners May Acquire Near Term Gold Producers In Europe

Why The Large Miners May Acquire Near Term Gold Producers In Europe
Greece is focusing on revitalizing the mining sector by fast tracking four mines that are in development. Athens hopes to be the biggest producer of gold in Europe by 2016. The politicians realize that the mining sector has great potential to create high paying jobs and revitalizing a moribund economy. For years prior to the economic crisis, mines in Greece were help up and permits were delayed by red tape and bureaucracy. Now that has changed as witnessed by Eldorado Gold's (EGO) $2.4 billion takeover of European Goldfields, which prior to the acquisition received critical permits. Similarly now in Spain, The Galician Government has labeled this Gold Asset as a "strategic industrial project" crucial for economic development and numerous high paying jobs for a region hit by record unemployment. The implications of this decision is significant as the company may receive permits imminently as Galicia needs investments in the region to accelerate sooner rather than later.
Read more

Why The Miners May Outperform Gold After The Election?

Why The Miners May Outperform Gold After The Election?
The miners are already beginning to outperform both bullion and the S&P 500 and we believe this trend will continue due to favorable fundamentals and seasonality. For the past six months, the silver miners (SIL) and gold miners (GDX) have outperformed. We expect this trend to continue as investors see possible weaker earnings and slowing growth in the large caps yet rising inflation and commodity prices, which benefit the miners. Notice that even during this pause in the rally both the gold and silver miners are holding up well versus the S&P500 and are outperforming bullion. The miners may be forecasting a coming breakout in gold at $1800 or a rotation from large caps to miners. After this breakout look for the large miners with rising share prices to make deals with the cheap junior gold miners for large premiums.
Read more

Why The Chinese May Buy Undervalued Junior Miners

Why The Chinese May Buy Undervalued Junior Miners
At this very moment, Chinese investors are utilizing a novel approach buying natural resources as the U.S. dollar and long term treasuries are possibly on the verge of a major decline, leaving the Chinese overweighted in this risky sector.
Read more