We are about to commence a major bull market in Gold, Silver, mining and exploration stocks. Many of them should move up to price levels that will astonish investors. Because there is very little comprehensive research coverage for most precious metals companies, many remain overlooked and undervalued. The oncoming price moves up in the precious metals shares’ prices should be far above investor expectations.
INDICATORS? If our eight indicators are correct, we are about to begin a full-fledged bull market in precious metals and many of the mining and exploration stocks. Yes, we have had an early stage bull market in some gold and commodities stocks which already carried some gold stocks up 800% and more (examples: Canadians Richmont, Claude Resources, Niogold-all taken over).
NAPOLEON BONAPARTE… Napoleon Bonaparte once advised to “never interfere with an enemy when he is making a mistake.” Some gold companies’ shareholders may be making a mistake by selling shares in stocks that they have lost patience with which is normal in a bear market. They should ask themselves “who is buying?” The mistake is that there is a very strong possibility that they are giving away undervalued stocks at very low prices. It may prove to be a big mistake as bargains occur during bear markets.
When the frustrated selling shareholder says “just get me out of this stock” a value investor may say “what a great opportunity the seller and the weak metals market have given me.” Price weakness offers value investors opportunities to invest in mining shares while they are literally “on sale” as well as exceptionally cheap. Someone’s mistake may be another’s opportunity.
Yet the majority of mining and exploration stocks have languished since the large U.S. brokerage industry never will acknowledge a bull market in gold. Major U.S. Brokerages are incapable of offering timely and accurate advice on gold as well as most investments. These self-serving institutions have focused on the industrial stocks bull market for the S&P 500 and Dow Industrials pushing far too many of them much too high in price. If our analysis is correct that may be about to end very badly.
We use “eight cyclical, technical and fundamental indicators” to determine if we are in a bull market in precious metals. Those indicators now suggest that we are commencing a full-fledged bull market in precious metals and hard assets. Some gold stocks have already commenced their own bull market but the overall gold sector has experienced a long bear market.
It is late in the precious metals bear market but investors can still find overlooked stocks at low prices and they can “double up” (dollar cost average) on companies that they own if the fundamentals are positive. Experienced value investors have been accumulating many exploration and mining shares during the last five years that are exceptionally undervalued.
Look at the officers and directors buying/selling activities in their own companies’ shares! Insiders are the actual managements of the gold companies. They have been buyers throughout the bear market with little selling. Note that today there is very little insider selling at all. Their insider activity suggests to us that they expect strong gold prices.
At the same time, insiders at the major U.S. industrial corporations (non-mining) are currently selling their own shares at the highest rate in history. In a recent four week period, officers and directors have sold over $2,000,000,000 of their own shares.
Our analysis now suggests a move very soon to the $1400 to $1500 (US Dollars) which will bring with it enormous initialmoves up in many gold, silver and exploration stocks. Our analysis has never been this positive. Yes, the banksters may continue with their manipulation of gold bullion but that game should end soon.
What does the gold and precious metals market need? It needs a bear market in the industrial stock markets which we almost require to have a bull market in gold and mining stocks.
What is the most important ingredient today for a bull market in gold? We have said it time and again; we need a lower value in the US Dollar to have a bull market in gold. We have seen it developing. According to an IMF report of summer 2017, the dollar still needs a further decline of approximately another 8%.
Are the gold and silver mining stocks undervalued? Yes, based on the value of resources per share as well as exploration potential, many of the legitimate mining and exploration stocks are now carrying the lowest valuation levels n over thirty years. Moreover, today the gold and mining sector is carrying the lowest valuation of all investment sectors. Yet, we recognize that still half of the mining companies will fail. Successful exploration is expensive and difficult so many companies do fail.
Why are they carrying such low valuation levels? The brokerage industry suffers during bull markets in gold and hard assets as it usually occurs concurrently with a bear market in industrial stocks bringing the brokerage industry large drops in profitability. Any increase in trading volume and activity in mining stocks is insufficient to make up for the losses. Thus, brokerage houses contest bull markets in gold and discredit anyone or any indicators that suggest a bull market in gold and commodities.
“Is there still manipulation in the price of gold bullion?” The manipulation has been so obvious in the futures contracts which are paper not the gold bullion. One recent afternoon’s volume (paper contracts) would be equal to seven months of total world gold production. A true gold bullion sale of that size would be physically impossible. However, the futures markets paper sales do create the appearance of weak gold prices. It’s not gold they are selling-it’s paper! We would like to see the true gold delivered. Recall when the Germans asked for their gold bullion held in safekeeping in New York four years ago? It took over three years to get it.
Little research is being done by brokerages for most precious metals stocks…. Some claim that it is too expensive to have research coverage on smaller stocks despite the fact that many are undervalued and offer investors opportunities for exceptional capital gains. Many brokerages do not permit brokers to buy most mining stocks despite extreme undervaluation of the shares.
Disappearance of the brokerages’ “Market Makers” In the past, market makers helped bring balance in the sales and buys in stocks, offering buying support when needed and offering shares when necessary. They would hold large positions in the stocks that they made markets in. At the same time, the market makers’ research departments would provide research which could create investor interest in the stocks. Most brokerage research has disappeared and investors must look for other sources for research..
Cycles…Maybe the most important ingredient of all
Cycles can be very useful when trying to make timing decisions. It is important for investors to recognize that several important cycles are saying that Gold should soon have a large move up….very large. At the same time, several cycles forecast bad times for the industrial stock market. ……very bearish times for industrial stocks but good for gold, silver, mining shares and hard assets.
