Tag Archives: JNUG

Trump Will Be Great For Gold And Silver (If Nothing Else)

I love days like today when both gold and the dollar are green. Historically, some of the best moves in gold occur as gold and the dollar move up together for short period of time. Today, of course, is just one day. And there’s no question that the Trump Government will need a significantly lower dollar in order to stimulate U.S. industry, assuming the latter is at all possible anymore.

On the other hand, if somehow Trump manages to get Congress to pass his border control and excise tax proposals, consumer prices on the products being imported at prices much lower than the same products can be produced domestically will soar. Let’s not forget, gold loves inflation.

In terms of the fundamentals supporting gold, the Fed’s unanimous decision to leave rates unchanged confirms my suspicion that the likely next move sometime later this year will be some sort of loosening of monetary policy. Consumer liquidity continues to dry up. This is especially evident in the retail sales reports plus the big drop reported for January auto sales.

In addition, various price inflation reports are starting to emerge. On Feb 1st, Bloomberg reported that the Citigroup Inflation Surprise Index, which is a global index that measures price surprises relative to market expectations, is at its highest in more than five years. Even the Government-produced inflation reports in the U.S. have been coming in “hotter” than expected. This is a difficult feat given all of the hedonic adjustments plus other various gimmicks the Government statisticians inflict on the data in order to mute the ability of the index to measure true inflation (note: the manipulation of the CPI was implemented by the Arthur Burns-led Federal Reserve shortly after Nixon closed the gold window – they knew what was coming, which was massive money supply expansion and the resulting price inflation).

In other words, even the Government will be unable to hide fully the effect that trillions of QE and credit expansion is having on consumer prices. This will act as a turbo-booster on the price of gold when this reality eventually grips the capital markets.

In the physical markets, despite China’s week-long closure to observe the Chinese New Year (Year of the Rooster), the eastern hemisphere markets continue to “consume” a lot of physical gold. Premiums all week in India have been high enough to reflect moderate to heavy legal kilo bar importation. Dore bar imports have been flowing steadily for several weeks.  Additionally, Vietnamese were paying $135 over world spot gold, indicating voracious demand.

The latest official Swiss gold export report for December shows that the Swiss exported 154 tonnes of gold to mainland China in December. This was almost four times higher than exports to Hong Kong and more than three times the amount of gold shipped from from HK into China’s mainland. This would be the gold that enters China via Beijing and Shanghai that goes unaccounted for by the World Gold Council and the GFMS data-keepers. Additionally, East and South Asian countries accounted for 87% of Swiss gold exports in December.

Thus, contrary to the popular mainstream financial fake news, China’s appetite for gold remains voracious. Needless to say, all the “stars are aligning” for what could be a spectacular year for the precious metals and mining stocks. Not the least of which is the unpredictability of, and the undefinable nature of, the Trump presidency.

Most of the above commentary was an excerpt from the February 2nd Mining Stock Journal.  In that issue I reviewed five previous names presented, of which three are significantly higher from when the MSJ presented the idea.  Of the other two, one is down about the same amount as the sector since August and the other one is a silver exploration company that is percolating on top of what may turn out to be one of the larger silver deposits in the world in addition to containing large quantities of zinc, lead and gold. I also mentioned an emerging producer that may be acquired before summer.

You can subscribe to the MSJ here:  Mining Stock Journal.  The publication is a bi-weekly newsletter with unique insight on the gold and silver market that also focuses on undervalued junior exploration and emerging producer ideas.  New subscribers, for now, will receive all of the back-issues.

I am a subscriber to both of your journals.  I just want to say “WOW” to this post on your site. Thank you for all your work. As a financial professional of 28 years’ experience, I can tell you why there is no churn in your journal subscriptions. Your work is extremely sound and well done even in a massively manipulated environment.  –  recent email from a subscriber to the Mining Stock and Short Seller Journals

Full Metal (Gold And Silver) Price Manipulation

I’m not sure of the significance of 20 minutes past the hour, and I’m sure it has some sympbolic meaning to the gold manipulation cabal, but for the last week the price of gold has been getting slammed with an avalanche of Comex confetti at regular intervals at 20 minutes past the hour.

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THAT is not the graph of a market that is allowed to trade freely.   But notice how gold bounces back sharply from every take-down attempt.  This is especially significant given that this is one of the slowest seasonal periods of the year for the buyers of physical gold and silver.

This morning (Tuesday morning) was particularly blatant.  Gold had traded steadily higher overnight from $1344 (December futures basis) to $1364 just after the Comex floor opened for business (8:20 a.m. EST/6:20 a.m. MST).

Whenever the elitists start to lose control of gold, they roll out one of their Fed stool pigeons to threaten the world with a 25 basis point (one quarter of one percent) rate hike at the next FOMC meeting (September).   Today’s park bench popcorn scavenger was NY Fed President, Bill Dudley, who stated on Fox Business that a rate hike in September is “possible.”  I guess that means September’s meeting is a “live meeting” – a phrase Dudley and SF Fed Prez, John  Williams, propagated the mainstream media propaganda meat grinder with in May – LINK .

But gold shrugged off Dudley’s empty, Straw-man threats and closed today respectably up about $5 from the close of yesterday’s afternoon “access market” trading session.  I still believe that gold could see $1500 by Halloween despite the Comex B-52 paper bombs being dropped religiously on the market.  And we are just one economic, political or societal catastrophe from gold making a rapid run toward $2,000.

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Buy every manipulated sell-off in gold and silver.  It’s the true “TINA” idea.

A lot of readers have asked me if it’s too late to buy mining stocks at this point. I refer them to a long-term graph of GDXJ so they can see where the junior miners have been relative to the level at which they bottomed. It’s a prototypical chart of a market that is in the early stages of a massive move higher. The key is to identify the exploration companies that have a high probability of hitting the proverbial pot of gold. The last 5-years caused a lot of damage to the junior sector, but there’s a lot of companies with “a pulse” that have been revived, albeit significantly undervalued from a risk/return standpoint.

My Mining Stock Journal is focused on finding companies that are currently overlooked by the mainstream mining stock analysts and newsletters. As an example, I presented a stock idea in mid-April that is up over 280%. It recently doubled in price shortly after a major newsletter service poo-poo’d the idea. I draw on several seasoned veteran contacts plus 15 years of experience researching and investing in this sector. You can access the MSJ – a bi-weekly report – here:   Mining Stock Journal.

I just received your August 4 Stock Journal and before getting to your suggestion and half way through your guidelines for picking stocks I wanted to write this first. I have attempted to find those obscure companies and must say it is most difficult. Upon reflection I should have just waited on your bi-weekly report because your picks have been awesome. – “Jim”

Gold And Silver Are Headed For New Highs

I’ve  been pounding the table since late January that the third leg of the gold and silver bull market had started in mid-December.  It’s also been quite clear to me that the western Central Banks had lost their ability to push the price of gold/silver down.  Now the best they can hope for is to maintain a “controlled retreat” – i.e.  do what they can to limited rate at which the metals move higher.  That’s why we get these “zip line” price plunge formations followed by another “stair step” higher.

But don’t take it from me.  Andy Hecht, a famed oil trader, had this to say:

“I have been trading precious metals since 1981, and I have never seen an environment where both the technical and fundamental states of the metals have lined up as they have in 2016. I believe that we may be in the early days of a rally that will take gold, silver, platinum and palladium to new all-time highs.”

I need to point out that earlier this year Hecht was slow to accept the move being made by gold and silver and had even issued some bearish remarks at one point.  You can read his full commentary on the metals here:  Gold/Silver Are The Place To Be. (He has the same graphs I was showing 6 weeks ago).

The silver mining stock I featured in the debut issue of the Mining Stock Journal is up over 7% this morning.  It handily beat earnings.  This is the only large-cap miner I have presented.  It’s nearly doubled since early March and the Company pays a monthly dividend.  The call options I recommended are up 260%.   Another stock I recommended in mid-April popped 60% earlier this week. I’ll note that Casey Research had recently “poo-poo’d” this stock. My Mining Stock Journal focuses “off the beaten path” ideas that are higher risk/very high return juniors.   You can subscribe to the MSJ here:  Mining Stock Journal.   The subscription price includes all the back-issues (for now).

Stunning Development In Comex June Gold Deliveries

If the Comex were allowed to issue paper contracts representing no more that 10 or 20% of the actual amount of gold held by Comex vaults, what would the price of gold be?

1.176 million ounces of gold have been delivered – or should I say “delivered” – for the June contract six days into the June contract delivery period.  I don’t follow the delivery patterns as closely as I used to, but this is a massive amount of stated deliveries.  Even more interesting is the fact that there’s still 6,683 Juno contracts open representing 668,300 ozs of potential deliveries.   This is a relatively high number of contracts still open this far into the delivery period.

One other interesting point of note is that over the last few months, a couple new “players,”  beyond the standard Comex bullion banks (JP Morgan, HSBC, Scotia) have been participating in the deliveries:  B of A (Merrill), International FCStone Financial, Morgan Stanley and SocGen.   All four of these have been taking an increasing amount of deliveries the past couple of months, primarily on behalf of customers (vs. for their own house account).

I have no idea what would be triggering this sudden increase in delivery activity on the Comex – other than the obvious.   And who knows to what extent the physical gold is actually being moved from the accounts of the delivering parties to segregated accounts of the parties taking delivery.   It would be even more interesting if a lot of this gold was being removed from the Comex, which would reinforce the likelihood that it really exists in unencumbered physical form.

On another note, the stock portfolio portion of the fund I co-manage was up 4.7% today vs. the HUI up .23% and the GDXJ “junior” ETF up 1.7%.  We own highly concentrated positions in true junior exploration stocks.  My point here is that a lot of money is flowing into the highest risk/return segment of the mining stock sector.  In my opinion this is a signal that the “smart” money is expecting a big move in the entire sector.

I publish the Mining Stock Journal, which is a bi-monthly subscription report which features a junior mining stock in every issue.  I try to find lessor known ideas because I want to put my money in good ideas before the wider universe of newsletters begin to discover them.   The next issue out this Thursday will be featuring a very small silver exploration company that appears to have found what could be very large silver (polymetallic) deposit.   You can access the Mining Stock Journal here:   MSJ Subscription Link.   I am sending all-back issues to new subscribers.

Considering the research and content, both the Mining Stock Journal and Short Seller’s  Journal are remarkable bargains.  – from subscriber “Jay”

 

Is It Time To Buy More Junior Mining Stocks?

That is an impossible question to answer with any degree of conviction because the extreme degree to which the precious metals market is manipulated.   I think now is a good spot to add to positions or start new positions.  As an example, in my latest issue of the Mining Stock Journal, I recommended a high quality junior that had almost pulled back to its 200 dma.  I said I was buying it for what I thought would be a “low risk” 25-40% bounce if the pullback cycle in  the sector is over.  That stock bounced 7% today.

A good way to protect yourself somewhat is to find high quality junior mining companies that are exceedingly cheap to their underlying “intrinsic” value.  I presented a company in the latest MSJ issue that, despite a big move already, has the potential to be a 5-bagger from here.  Insiders control 44% and put in millions of their own money over the last 5 years to keep the Company going.  This Company is on its way to becoming very significant mining company.

Today I sent around to subscribers an update of a stock previously presented because the Company announced an acquisition of an existing operational mine and is paying roughly $20/oz for proved gold in the ground.  This company is “off the radar screen” but Goldcorp just paid over $100/oz in the ground for Kaminak.  This acquisition will be the catalyst that enables management to build a 200-250k oz gold producing operation by 2019.  It’s market cap is mining-stock-journal-bannerwell under $100 million.  Companies that produce 200-250k ozs/year trade in the $200 million to $400 million market cap range.  You do the math on this Company…

You can subscribe to the Mining Stock Journal and get the current issue, the current update and all the back-issues (March 4th debut) by clicking here:   MSJ Subscription.

Gold And Silver Continue To Scaling The Wall Of Worry

At the beginning of this week, almost every so-called gold market analyst was predicting a wash-out in precious metals because of the huge bullion bank short being reported in the COT report.  A few of us believe that character of the market has changed and paper market price manipulators are losing traction – for a lot of reasons.

This week shows that the banks covered a portion of their shorts and the hedge funds and little guys sold down longs and increased their shorts.  This information may be largely irrelevant.  Interestingly, in data I’ve parsed and presented in a previous blog post,  the beginning of two of the best gold/silver rallies since 2001 occurred at a time when the bullion banks held their biggest short position in gold futures (expressed as a ratio of total open interest).

The latest issue of the Mining Stock Journal was released last night.  In it I discussed the use of JNUG (the 3x junior mining stock index ETF) and I explain why we could be on the cusp of the best move yet in the sector.   And of course I present a remarkably undervalued junior mining company (a royalty company) in which insiders bought a boat-load of shares in January and now control over 30% of the equity.  You can access the MSJ here:   Mining Stock Journal.  

A subscriber had an interesting question that is a common question I get currently:    I really enjoyed this latest edition of your newsletter. I find myself getting less and less nervous about a price smash as it feels that the powers that be can no longer stem the tide of reality. One question I do have is whether you think a massive asset deflation event (similar or greater than 2008-09) will have a negative or positive impact on the shares

My reply:   I think there’s is going to be a collapse in all “assets” that have been inflated in price by the use of debt:  housing, NYSE stocks, bonds, etc.  That is different than general price deflation.  We may see a LOT more money printing as the Fed/Government attemptsUntitled to prevent a debt-driven asset collapse.  This will could drive the price of necessities up a lot.  But this  will really fuel the entire precious metals sector, especially the junior miners which have proved gold/silver/poly-metallic deposits.  (click in image to enlarge).

Any asset valuation collapse because of debt implosion will act like a heavy dose of Viagra on the value of mining stock shares.  Look at what happened in the 1930’s to stocks like Homestake Mining when the Dow was crashing.  When the initial stock plunge occurs, the miners might correlate lower for a bit but then they’ll do a life-style changing moonshot.

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Are The Mining Shares Rolling Down The Runway?

If anyone has been watching the trading action of the mining sector, they’ll notice that the “character” of the action has changed since the end of December.  The way I expressed it to my fund partner the other day:  “Rather than shorting the rallies and covering the sell-offs, it’s time to start going long on the sell-offs and taking profits on the rallies” (while keeping a core position intact, of course).

It’s easiest to see this point illustrated using JNUG, the 3x leveraged junior gold miners index ETF.  JNUG has carved out a nice rounded bottom and appears to be grinding higher. The entire sector is behaving like this, but it’s easiest to see it visually using a 3x ETF graph:

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Today is a perfect example, as the mining sector was hammered from the opening NYSE bell, with JNUG trading down over $3 from yesterday’s close (roughly 9.5%) to $30.15.  It’s rallied back close to $34, up nearly 1% now.  This trading action has been fairly consistent.

What’s even more striking, and something I had not really paid attention to until today, was the massive volume that has been occurring on a daily basis since early November.  This is the unmistakable of the last of the weak hands puking out their positions and the smart, patient money accumulating the shares.

I’m the first to admit that I’ve made so incorrect bottom calls on this sector since last summer.  But then again, is there anyone out there who can say they’ve succussefully been able to predict the direction of any highly manipulated market?   Having said that, I believe that the mining stocks may be rolling down the runway, preparing for a lift-off…

This Junior Mining Stock Is Outperforming The Sector – Update

This stock is green again today – with the mining stocks getting hit hard by the hedge funds/banks…

Since I posted this two days ago, the stock is up over 5% – I added a technical report which gives advice on accumulating this stock from DenaliGuide’s Summit subscription area.  You can access the updated report here:  Junior Miner Outperforming The Sector.  I explain why this stock can at least double in the next year.

I originally published a report on this Company in early June.  Since then, here is how it has performed vs. gold and the sector (click to enlarge):

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I have updated this report to reflect recent developments and I offer an explanation for why this stock has been outperforming the sector. You can access this report here:  Junior Mining Stock Report.

I know the management was in China late last spring meeting with several of the largest Chinese mining companies.  I believe the Company is engaged in very prelimary discussions about selling one of its huge copper projects to one of China’s largest mining conglomerates.   I’m pretty certain that’s why this Company’s stock has held up well since the takedown of the sector began in mid-July.

Even on its own, separate and apart from the possibility of any kind of M&A event, this stock is significantly undervalued.   It is currently generating royalty revenue from a big gold mine in Nevada.  That mine is going to be operating an expansion project in late 2015. This expansion will increase the Company’s royalty stream.

Furthermore, this Company has a massive prospect/project portfolio, a handbook of which is attached to my report.  As the price of gold and silver recover and move higher again, which will happen sooner or later, I believe this stock can provide close to a double in the next twelve months and a triple over two years.  That’s assuming the metals don’t go parbolic…(click on pic to access this report):

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Putting The Current Gold/Silver Market In Proper Perspective

Follow the money.   My friend and colleague, Nick of DenaliGuide’s Summit blog has done a short video to explain why the current trading action in gold and silver – although seems quite bearish – is really a non-event.   The goal is to help ease everyone of the oppressive negative sentiment the has engulfed the precious metals investing community.

Some Nick’s “hidden” talking points include the fact that:

1)   gold and silver bottomed in last June 2013
2)  June 1st this year:   gold is up almost 3%, silver is up just over 3%;  GDX is up almost 20%

Sure doesn’t feel like the precious metals sector has had positive returns this year, does it?

Please take 2 minutes to watch Nick’s informative video:  Market Sentiment Belies The Numbers.  (Samples of Nick’s T/A research, which I use, are linked at the top of the blog)

Perhaps what’s most interesting can be seen in this graph from Nick (click to enlarge):

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This shows the GDX index since mid-June.  As we know, gold and silver rallied along with the GDX into mid-July and have largely retraced nearly back to their June 1 starting prices. BUT, the mining stocks have been marking time in a sideways pattern.  The black line on the graph shows the amount of “stealth” accumulation that is occurring on every down-tick in the mining shares.  I have noticed this as I watch the tape every day, but this graph illustrates it.  The message:  SMART MONEY IS ACCUMULATING MINING SHARES.

I have several mining stock ideas here:   IRD Research Reports

My “Huge Upside” idea has pulled back on zero news.  I added some to the fund I manage today.  My “Short Term Trade/Long Term Investment” idea is back above my recommendation level.  I expect it to outperform going forward, assuming the precious metals sector starts trending higher.