The birth of the gold bull market on December 17th, 2015 is stronger than ever.
We have a hated gold market that is even despised by many gold bugs who’ve turned to cryptocurrency and abandoned the precious metals completely.
Just over 2 years ago, gold hit a low of $1,051. During the 2016 bull market awakening, the metal saw an 8.5% gain for the year, the first annual rise in 4 years.
By the end of 2017, gold had added another 13%, having its first back-to-back annual gains since 2011-2012.
Despite the obvious, the mood couldn’t be worse for gold and gold shares.
It got so bad in 2017 that even the numismatic coins, which can have premiums of $500 over spot in a bull market, were barely trading for more than a standard gold eagle coin.
Not much has changed here in early 2018. The gold bull market continues, but it’s not being reflected in the shares, even though we are about $50 away from making a NEW bull market high.
From 2004 to 2007, we saw the Dow Jones make new highs, and we also saw gold triple!
We see the same thing happening over the next 3 years. In our analysis, $1,400 gold (and possibly even $1,600) is baked in the cake for 2018.
The FED hikes have consistently given gold a higher price in the weeks and months after, and the ultimate indicator for higher gold prices, the U.S. dollar, is accelerating its move lower.
In our opinion, due to retail sentiment and the lack of institutional demand, we still have a few more months to accumulate gold shares before they have a liftoff moment sometime in 2018 after the gold price surpasses 52-week highs and crosses over $1,400.
Here are the stocks we are adding to right now in anticipation of a gold stock rally in the spring/summer of 2018:
1. Silver One Resources (TSXV: SVE) has one of the purest silver assets on Earth! It’s in the safe mining jurisdiction of Nevada.
2. GoldMining Inc. (TSXV: GOLD) has a monster gold (and copper) portfolio, and Rick Rule has referred to it as a top optionality play on the gold price.
3. First Mining Finance (TSX: FF) has high-quality, minable ounces in Canada. This one is setting up to be a lucrative takeover target for any major that is looking for turnkey gold assets.
Once the premium spikes, we suggest selling them and converting them to American Eagles or Maples and either pocketing the numismatic premium profit or using it to accumulate more physical gold ounces.
Editors Note: I am long all the companies mentioned in this letter.