For gold and silver, the price continues to firm up here; and contrary to the “market’s” expectations, they are moving higher with the rate hikes as we have been forecasting since December 2015 when we called the first rate hike, the “birth of the new gold bull market.”
Ultimately, the debt ceiling will be raised, but at what political cost and with how much drama… any level of crisis will be good for precious metal investors.
When it comes to the gold shares, they are up big year-over-year, however, 2017 has been a struggle with enormous selling pressure. In our opinion, the shares won’t move big until gold is over $1,300 and headed to new 52-week highs once it trades above $1,365.
It won’t take much to make 52-week highs, which we expect by early summer. Since the December 2016 rate hike, gold is $110 per ounce higher, and in the past two weeks since the March hike, it’s rallied $51.
Silver is also showing enormous support and is leading the precious metals higher here in 2017, moving at 1.5x the percentage of gold. The juniors’ slump has a lot more to do with the insiders of Vancouver.
Home of the TSX Venture, you can find nearly all of the publicly-traded mining shares and pre-IPO deals in 1 square mile in British Columbia. The mood within this community right now is to sell at any price. Since most of them provide little to no value, what choice do they have? Their paychecks are inflated working for a public company who will never make a profit, and they need to sell in order to support their lifestyle.
Most of them probably rolled their 2016 profits into private placements and now find themselves in a panic because the sector isn’t going parabolic. It’s why we put a special focus on people. From the major shareholders to the management, the people should not be speculative.
I’ve said this many times before, I have no doubt that the vast majority of investors won’t make a penny in this new bull market. With hundreds of scam companies and only a sliver of real ones, the sector is terminal for investors.
Be a very strategic stock buyer in this sector now and the rewards will be great. Try to day trade it or back a company that doesn’t have insiders who own their own stock and you’ll be burned badly. Institutions love the mining shares as well, but for all the wrong reasons – it’s a tiny market that they can manipulate easily.
Short the mining shares and then short gold and it becomes a self-fulfilling profit. It’s the same for the long side; in either case, it doesn’t take much to move these tiny stocks up or down 25 to 50% in any given quarter.
The bull market is here, though. The smart money is coming in, and the true winners are taking big positions in key stocks.
Now is an accumulation period, but we expect the gloomy mood to end by summer and a real firework show to begin for the sector, especially for the high-quality go-to companies that lead the space.
FutureMoneyTrends.com is putting together the most important gold stock report ever written and will release it some time in mid-April, it will be the key to unlocking the largest upside possible for this sector. And yes, it will include on a gold platter, the name or names, you need to consider aggressively scooping up before the next big run.