Palladium and Rhodium Are on Fire, Is Platinum Next?

Platinum was once the most precious of metals. For decades, it traded at a premium to gold. The other platinum group metals – palladium and rhodium – barely registered on investors’ radar screens.

Platinum lost its crown to gold in 2015. It was overtaken by the other Platinum Group metals (PGM) metals in recent weeks.

Given that platinum, palladium, and rhodium demand is largely driven by automobile manufacturing and the production of catalytic converters, one of these things is likely true; platinum is currently undervalued, or the other two have gotten ahead of themselves.

1 oz rhodium bars run about $1,455 each.

Which one is the correct assessment will depend on whether the current optimism for economic growth in both developed economies and emerging markets has been well placed. Either way, investors inclined to speculate on the PGM metals have some interesting market action upon which to trade.

Platinum does look remarkably underappreciated. It is hard to imagine it trading at a significant discount for too long.

Auto makers should bid for whichever metal offers the lowest cost as all three are somewhat interchangeable.

Platinum offers the largest and most liquid market of the group. It is widely available in a variety of coins and bars. For investors, platinum’s liquidity is a consideration.

However, momentum traders may want to take a look at rhodium. It is traded in relatively tiny quantities and has a history of making big moves. Rhodium saw a top near $4,000 in the early 1990s and it made a run north of $2,000 about 10 years later. It peaked at $10,000 per ounce in 2008.

Although rhodium has doubled in the past year, it currently trades just over $1,300.

The metal’s pattern of having a sharp spike roughly once every 10 years is interesting. It is possible we are in the middle of another of those massive moves now.

Rhodium is available primarily in 1 ounce bars. While the quantity of rhodium traded is by far the lowest among precious metals, market liquidity for that metal has seen a boost since 2008. There are now a couple of ETFs focused on the metal. Those ETFs may in fact be driving a good portion of the recent demand.

Clint Siegner is a Director at Money Metals Exchange, the national precious metals company named 2015 “Dealer of the Year” in the United States by an independent global ratings group. A graduate of Linfield College in Oregon, Siegner puts his experience in business management along with his passion for personal liberty, limited government, and honest money into the development of Money Metals’ brand and reach. This includes writing extensively on the bullion markets and their intersection with policy and world affairs.

The post Palladium and Rhodium Are on Fire, Is Platinum Next? appeared first on Gold Silver Worlds.

from Gold Silver Worlds http://goldsilverworlds.com/gold-silver-general/palladium-rhodium-fire-platinum-next/

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Gold/Silver vs. Bitcoin Comparisons: A No-Brainer… or Brainless?

For most of the year, as Bitcoin soared, crashed, and soared again, cryptocurrency vs. physical gold-silver talking heads engaged each other in heated rhetoric about which of these venues is here to stay.

Some of the biggest names in finance, government, and the newsletter analyst space have made comments that – to be charitable – appear less-than-fully informed. Comments like “Even though bitcoin could rise to $100,000, it’s still going to zero!” don’t offer much insight. Some other questionable assumptions:

2017 percent price change comparisons: Relating this year’s gold and silver’s price range to that of bitcoin misses an important point. Yes, bitcoin (BTC) has risen by a much greater percent, but it’s also fallen more. I don’t recall gold dropping 40% this year, which bitcoin has… on a couple of occasions.

Please note: Bitcoin has no tangible, physical form.

Trash-talking gold and silver as “antiquated”: Bitcoin is now considered legal tender in Japan, but at this time, its primary function is for use in the purchase and sale of the 900+ “alt coins” currently available.

Most of these exchange entries in the crypto-space are not really “currencies” at all and will never trade as such.

Rather they are “coins” or “tokens” digitally created and circulated to raise seed money, via initial coin offerings (ICOs) in order to solve some business application in a blockchain-connected manner. Many have no trading volume – possibly because the market is skeptical of their business plan – and have become more or less “dead” coins.

At present, a relative few have an actively trading market. Investors have dropped literally millions of dollars into scores, if not hundreds of entrants which have appeared on the scene like dragon’s teeth, in many cases only to see volume dry up soon thereafter.

At present, digital apparitions can be created and marketed by just about anyone. The following example demonstrates how easy it is (for now), and how gullible some people really are.

Can I interest you in a “Useless Ethereum Token”?

Earlier this year, the “Useless Ethereum Token” (UET) was “announced” online. The “Issuer” wrote:

You are literally giving your money to someone on the Internet and getting completely useless tokens in return. There are no ‘whitepapers,’ no ‘products’, and no ‘experts’. It’s just you, me, your hard-earned Ether, and my shopping list.

You would think this blatantly-stated scam would elicit exactly zero response, yet reportedly, the UET ‘Project” was able to raise more than $60,000!

By the same token, it’s a safe bet that many Venezuelans wish they had traded some of their bolivares fuertes (“strong Bolivar”) notes, rendered worthless over the last few years, for a few ounces of silver – or a single ounce of gold – which could now purchase respectively, six months of food, or a house.

Becoming a victim of “default bias”: We all have a tendency to operate through a lens which uses the past as a default setting.

We keep doing what we know, avoid taking new risks, and resist changing the way we think.

Default bias can cause lost opportunities – whether it involves learning about the blockchain or being hesitant to buy precious metals when they’re in boring “wear you out or scare you out” sideways action (another David Morgan homily) … as they’ve been lately.

Dismissing Bitcoin as “just digital”: Kim Iskyan (Stansberry Churchouse Research) addresses the criticisms leveled at bitcoin and the blockchain. Responding to the charge that it’s “purely digital,” he notes that fully 90% of all the money – or as David Morgan refers to it, “paper promises” – that exist around the world today are not physical either!

Doug Casey is always one to see beyond the next investment valley (or country), and he pegs what most people miss when they argue that bitcoin is “bad” for the future of precious metals. As he said,

When people buy these cryptocurrencies, even if they know nothing about hard money, economics, or monetary theory, they inevitably ask themselves, “Hmm, Bitcoin or the dollar?” They’re both currencies. Then they start asking questions about the nature of the dollar…the nature of inflation… and whether the dollar has any real value, what’s going to happen to it, and why.

People start asking themselves these questions – which wouldn’t have occurred to them otherwise… and it’s going to make them very suspicious of the dollar. It’s going to get a lot of people thinking about money and economics in a way they never thought about it before. And this will inevitably lead them to gold

What I am doing: In addition to staying very active in metals and miners, I have placed “small money” into several coins and tokens having viable business models in hopes of making an asymmetric profit.

In spite of the current turmoil, I remain steadfast in the belief that the next few years will see gold and silver trading several times higher than their nominal 2011 prices of $1,900 and near $50 respectively. The blockchain is here to stay. As for bitcoin, only time will tell.

We may even see digital coins and tokens backed by precious metal. But these changes in the crypto space will not replace them. Indeed, gold and silver will almost certainly – to the surprise of many bitcoin bulls – markedly increase demand.

I plan to continue holding the majority of my investible funds in gold and silver. How about you?

David Smith is Senior Analyst for TheMorganReport.com and a regular contributor to MoneyMetals.com. For the past 15 years, he has investigated precious metals’ mines and exploration sites in Argentina, Chile, Mexico, Bolivia, China, Canada, and the U.S. He shares his resource sector findings with readers, the media, and North American investment conference attendees.

The post Gold/Silver vs. Bitcoin Comparisons: A No-Brainer… or Brainless? appeared first on Gold Silver Worlds.

from Gold Silver Worlds http://goldsilverworlds.com/category-bitcoin/goldsilver-vs-bitcoin-comparisons-no-brainer-brainless/

Miner Exceeds Estimates for Gold Produced in Q3/17

Source: Streetwise Reports   10/19/2017

BMO Capital Markets reported the preliminary Q3/17 production results for this senior gold producer.

According to an Oct. 16 research note, Yamana Gold Inc. (YRI:TSX; AUY:NYSE; YAU:LSE) produced 257 Koz gold in Q3/17 from six of its seven mines (excluding Brio). The quantity achieved surpassed BMO Capital Markets’ expected 240 Koz “based on better-than-expected production from Chapada, Malartic and El Peñón, offset by lower production at Minera Florida,” indicated analyst Andrew Kaip.

As for other metals, Yamana produced 37.1 Mlb copper, which beat BMO’s anticipated 33.9 Mlb, Kaip added. It generated 1.43 Moz silver, which was in line with BMO’s estimate.

About the Canadian miner’s Q3 performance, Kaip concluded that “incorporating the stronger-than-expected production results is expected to have a positive impact to earnings.”

Yamana’s gold production for the first three quarters of 2017 is 717 Koz, Kaip noted. This represents about 76% of its 940 Koz gold production guidance for this year. Although the company increased its guidance for gold once already in 2017, it is “currently evaluating whether or not to increase production guidance for gold, silver and copper based on year-to-date production and an expected strong Q4/17,” he wrote.

Kaip also noted that as of Sept. 30, Yamana had “approximately $125 million in cash.”

This metals producer will report complete Q3/17 operational and financial results on Oct. 26 followed by a conference call on Oct. 27.

BMO Capital has a Market Perform rating and $3.25 per share price target for Yamana, whose shares are trading at around $2.64 per share.

Want to read more Gold Report articles like this? Sign up for our free e-newsletter, and you’ll learn when new articles have been published. To see a list of recent articles and interviews with industry analysts and commentators, visit our Streetwise Interviews page.

Disclosure:
1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are sponsors of Streetwise Reports: None. Streetwise Reports does not accept stock in exchange for its services. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article.

Additional disclosures about the sources cited in this article

( Companies Mentioned: YRI:TSX; AUY:NYSE; YAU:LSE,
)

from The Gold Report – Streetwise Exclusive Articles Full Text https://www.streetwisereports.com/pub/na/17779

Columbus Gold Is Giving Free Shares Away

Source: Bob Moriarty for Streetwise Reports   10/18/2017

Bob Moriarty of 321 Gold discusses Columbus Gold’s imminent spinout of its Nevada properties.

I have followed Columbus Gold Corp. (CGT:TSX; CBGDF:OTCQX) since I first wrote about them in 2014. Their main gold project is in French Guiana and is part of a JV with a Russian company. It’s a great project with 2.75 million ounces of proven and probable reserves of gold. Columbus Gold owns 45% and Nordgold owns 55%. At $1200 gold the project has an after tax IRR of 23% and an NPV of $324 million US. Owning 45% should make CGT’s interest worth $145 million US or about $185 million CAD. Instead Columbus has a market cap of right at $100 million CAD.

And they own 14 projects in Nevada including one with a 721,000 gold equivalent ounce resource. Management realized they are not getting any value out of the Nevada projects so they are spinning them off into a new company named Allegiant. That’s where the free shares come into the deal.

Columbus is holding a special meeting the 20th of November for shareholders to vote on the spinout. Shareholders as of the Share Distribution Record Date will receive 1/5th of a share of Allegiant for every Columbus share held. The company anticipates the record date to be four business days after the meeting or the 24th of November. So if you own 10,000 shares of Columbus on the Record Date, you will be handed 2,000 shares of Allegiant.

That’s a hell of a deal for a couple of reasons. Andy Wallace is going to be the CEO of Allegiant. As a manager and now owner of Cordex, he helped the company find an incredible eight gold mine discoveries in Nevada including the five million ounce Marigold Mine, the twelve million ounce Lone Tree Mine and the Daisy Mine.

Allegiant plans on drilling ten projects of the fourteen in the first twelve months. Their two most important projects are Eastside with an existing 721,000 gold equivalent ounce resource and a historic gold resource of 270,000 ounces and the Bolo project northeast of Tonopah. Columbus recently drilled 14 RC holes at Bolo about 500 meters south of a historic hole returning 30.5 meters of 3.24 g/t gold, 12.2 meters of 3.05 g/t gold and 19.8 meters of 1.1 g/t gold. The company is not going to release the results of the drilling until after the spinout is complete. They anticipate assays being back about mid-December.

Columbus is in the process of setting up a non-brokered private placement with terms not yet disclosed. The shares will be free trading right out of the chute.

The spinout is brilliant for creating more value to both Columbus and existing shareholders. Columbus will get 13% of the new shares, existing shareholders will get 52% and new investors will receive about 35% of Allegiant. Allegiant will be well funded for a major 2017-2018 exploration program.

Columbus Gold is not an advertiser. I bought shares in the open market that I intend to hold through the record date and I am participating in the private placement. Do your own due diligence.

Columbus Gold
CGT-T $0.65 (Oct 20, 2017)
CBGDF-OTCBB 153 million shares
Columbus Gold website

Bob and Barb Moriarty brought 321gold.com to the Internet almost 16 years ago. They later added 321energy.com to cover oil, natural gas, gasoline, coal, solar, wind and nuclear energy. Both sites feature articles, editorial opinions, pricing figures and updates on current events affecting both sectors. Previously, Moriarty was a Marine F-4B and O-1 pilot with more than 832 missions in Vietnam. He holds 14 international aviation records.

Want to read more Gold Report articles like this? Sign up for our free e-newsletter, and you’ll learn when new articles have been published. To see a list of recent articles and interviews with industry analysts and commentators, visit our Streetwise Interviews page.

Disclosure:
1) Bob Moriarty: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: Columbus Gold. Columbus Gold is not an advertiser on 321 Gold. I determined which companies would be included in this article based on my research and understanding of the sector.
2) The following companies mentioned are billboard sponsors of Streetwise Reports: Columbus Gold. Streetwise Reports does not accept stock in exchange for its services. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article.

( Companies Mentioned: CGT:TSX; CBGDF:OTCQX,
)

from The Gold Report – Streetwise Exclusive Articles Full Text https://www.streetwisereports.com/pub/na/17776

Trio of Firm’s Mines Log Strong Performance in Q3/17

Source: Streetwise Reports   10/16/2017

Analyst Andrew Kaip compared this silver, gold and base metals miner’s reported Q3/17 production results to the numbers expected by his firm, BMO Capital Markets.

In an Oct. 12, 2017 research report Kaip indicated that overall Q3/17 production was “strong” from three of Hecla Mining Co.’s (HL:NYSE) four mines: Greens Creek, Casa Berardi and San Sebastian.

This diversified company’s Q3 production of silver, lead and zinc exceeded BMO’s expectations, whereas that of gold reached the anticipated level, added Kaip. Actual versus estimated production was 3.3 versus 2.9 Moz for silver; 5.4 versus 5.1 Kt for lead; 14.5 versus 13.2 Kt for zinc; and 64 versus 63 Koz for gold.

The research note also detailed Q3/17 production for each of Hecla’s producing mines:

Greens Creek in Alaska performed the best during the quarter, thanks to its silver production. When compared to Q2/17, it was up, from 1.9 to 2.3 Moz, while gold production of 12.6 Koz was flat. Kaip noted that “production benefited from the mill operating at 2,391 tons per day, which is a life-of-mine record.”

Casa Berardi in Quebec produced 44.1 Koz gold, “slightly higher” than the 42.2 Koz estimate, wrote Kaip. He highlighted that “mining from the East Mine Crown Pillar pit continues to help supplement underground ore and fill the mill, which operated at 3.5 Ktpd in the quarter and set a monthly record in September at 3.9 Ktpd.”

San Sebastian in Mexico met expectations, Kaip indicated, “producing 881 Koz of silver and 6.3 Koz of gold.”

Lucky Friday in Idaho turned out “a nominal 88 Koz of silver,” said Kaip, which was anticipated due to supervisory staff members making on-site capital improvements. “We currently assume the resumption of operations in Q1/18. . .the strike at Lucky Friday is still ongoing,” he added.

As for Hecla’s Q3/17 cash and cash equivalents, they “increased by $3 million ($3M) from Q2/17 to $205M,” Kaip reported. The company will announce full Q3/17 financials on Nov. 7.

BMO Capital has a Market Perform rating and a $6 per share price target on Hecla Mining, whose stock is now trading at around $5.22 per share.

Want to read more Gold Report articles like this? Sign up for our free e-newsletter, and you’ll learn when new articles have been published. To see a list of recent articles and interviews with industry analysts and commentators, visit our Streetwise Interviews page.

Disclosure:
1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are sponsors of Streetwise Reports: None. Streetwise Reports does not accept stock in exchange for its services. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article.

Additional disclosures about the sources cited in this article

( Companies Mentioned: HL:NYSE,
)

from The Gold Report – Streetwise Exclusive Articles Full Text https://www.streetwisereports.com/pub/na/17770

Silver May Pop and Drop in Setup for Upswing

Source: Clive Maund for Streetwise Reports   10/15/2017

Technical analyst Clive Maund charts the reasons silver bugs may have an opportunity for happier days ahead.

Like gold, silver gapped out of its downtrend last week, but volume was lacking on this move, which, given the now bullish outlook for the dollar, may turn out to be a “pop” that will be followed by renewed decline. This breakout was predicted in the last update, when it was pointed out that silver’s COTs were still far from outright bullish.

You are referred to the parallel Gold Market update to read the reasons why the dollar may be shaping up for a sizable rally back to the 97 area on the index, before turning and heading south again. Needless to say, this can be expected to knock gold and silver back down again.

On its latest 6-month chart we can see how silver gapped higher last week, after breaking out of its recent downtrend a few days before. As mentioned above, due to the immediate outlook for the dollar being positive, with a sizable “swan song” rally in prospect, this breakout by silver may well turn out to be a “pop” to be followed by renewed decline. How far might it drop? A logical target, given that gold would probably drop to the $1,200-$1215 area, would be somewhere in the vicinity of its July lows, i.e. somewhere in the $15 area.

maundsilver10-15

While silver’s latest COTs look rather better than those for gold, they are still a long way from being outright bullish—there is plenty of room for improvement, and thus plenty of room for silver to drop short-term. . .

maundsilvercot10-16

Like gold, silver is marking out a giant head-and-shoulders bottom pattern, but in silver’s case it is downsloping, as we can see on its 8-year chart below. This reflects the fact that silver tends to underperform gold at the end of sector bear markets and during the early stages of sector bull markets. Prolonged underperformance by silver is therefore a sign of a bottom.

This chart really does show how unloved silver is right now, but although the price has drifted slightly lower over the past several years, volume indicators have improved, especially this year—a positive sign. A break above the neckline of the pattern—the black line—will be a positive development, and more so a break above the band of resistance approaching the 2016 highs. Once it gets above this it will have to contend with a quite strong zone of resistance roughly between $26 and $28.

Silver is among the most unloved of all metals, a situation that is not expected to continue, partly because silver bugs are manic-depressive and they have been depressive for a long time, meaning that it surely won’t be all that long until they are on the rooftops singing Happy Days Are Here Again, although it now looks like they will have to put up with another retreat by silver first as the dollar stages a relief rally.

maund8year10-16

Clive Maund has been president of http://www.clivemaund.com, a successful resource sector website, since its inception in 2003. He has 30 years’ experience in technical analysis and has worked for banks, commodity brokers and stockbrokers in the City of London. He holds a Diploma in Technical Analysis from the UK Society of Technical Analysts.

Want to read more Gold Report articles like this? Sign up at www.streetwisereports.com/get-news for our free e-newsletter, and you’ll learn when new articles have been published. To see recent articles with industry analysts and commentators, visit our Streetwise Interviews page.

Disclosure:
1) Statements and opinions expressed are the opinions of Clive Maund and not of Streetwise Reports or its officers. Clive Maund is wholly responsible for the validity of the statements. Streetwise Reports was not involved in the content preparation. Clive Maund was not paid by Streetwise Reports LLC for this article. Streetwise Reports was not paid by the author to publish or syndicate this article.
2) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

Charts provided by the author.

from The Gold Report – Streetwise Exclusive Articles Full Text https://www.streetwisereports.com/pub/na/17769

Gold and the Dollar: Good News and Bad News

Source: Clive Maund for Streetwise Reports   10/15/2017

Technical analyst Clive Maund discusses what he sees as a “swan-song rally.”

We’ve all had people come up to us and say “Do you want the good news
first or the bad news?” I always opt for the bad news first, to get it
out of way and end on a lighter note. The bad news is that the dollar
looks set to stage a significant “swan-song” rally in coming weeks, which
will probably result in gold being beaten down again. The good news is
that once that’s done its toast—and that’s when the big gold and
silver bull market that longer-term charts are calling for will really
get underway.

The last update called for the dollar to drop down to mark out the Right
Shoulder of a Head-and-Shoulders bottom pattern, and for gold to break
out of its rather steep intermediate downtrend and rally, and that is
exactly what has since happened. On its latest 8-month chart, we can
see how the dollar has backed off to the vicinity of its flattened out
50-day moving average and the vicinity of the Left Shoulder low of the
base pattern, in order to mark out the Right Shoulder low. Three bullish
developments to be noted that result from the dollar rising out of the
Head of the pattern are the breakout from the downtrend, the break clear
above the 50-day moving average, and the big improvement in momentum
(MACD), which is swinging positive. If our interpretation that this is a
genuine Head-and-Shoulders bottom is proven valid, the pattern targets
the 97 area in coming weeks, probably by early November. Needless to
say, this will not be good news for gold and silver prices.

Our prediction made many weeks ago that the dollar would rally off the
lower boundary of its big bullhorn pattern shown on the 4-year chart
below to break out above its restraining Dome has proven to be correct,
and a projection has been drawn on this chart showing roughly what is
expected to happen. As we saw above on the 8-month chart, the base
pattern now approaching completion targets the 97 area approx. This is
the “swan-song rally”—the dollars last rally before it “hands in its
dinner pail,” and should present a wonderful last opportunity to
accumulate the better gold and silver stocks, before the dollar does an
about face, and breaks down from the large Broadening Top pattern into a
severe decline.

The Hedgers chart has been warning for weeks that the dollar will
reverse and rally, as has been pointed out repeatedly. The latest chart
shows the rally is still ahead of us—which is congruent with the
dollar being at the Right Shoulder low of its Head-and-Shoulders bottom.

Click on chart to pop up a larger clearer version.

Chart courtesy of http://www.sentimentrader.com

In light of the above it is logical to expect gold’s plucky little
breakout from the steep downtrend channel shown on its 6-month chart
below to abort, and if the dollar advances towards the 97 area on the
index, we would expect gold to react back, probably to the $1200–$1215
area.

Such a reaction back by gold accords with its latest COT chart, which
still looks more bearish than bullish, since gold’s COT structure
improved but little on its recent downtrend. There is still a lot of
room for improvement on this chart—and that probably means lower gold
prices dead ahead. . .

Click on chart to popup a larger clearer version.

On gold’s 8-year chart it continues to look like it is in the late
stages of a giant Head-and-Shoulders bottom pattern. The build up in
volume over the past 20 months certainly looks positive, especially over
the past several months, all the more so because it has driven volume
indicators higher, notably the Accum-Distrib line, which is not far off
making new highs—exceeding its level at the 2011 peak. Once gold
breaks above the resistance level approaching $1400 it will be on its
way, although it will then have to contend with another important band
of resistance in the $1510–$1560 range. A near-term retreat by gold to
the $1200–$1215 area in the face of a dollar rally will not damage
this long-term technical picture.

The Market Vectors Gold Miners, GDX, which functions as a gold stocks
index, is marking out a giant Head-and-Shoulders bottom that roughly
parallels the one completing in gold itself. A near-term decline to $20–$21 in GDX will be viewed as presenting another important buying
opportunity for the sector. The volume pattern during the build out of
this base pattern is very bullish, with big volume on the rise out of
the low (Head) of the pattern, tailing off steadily as the Right
Shoulder has formed.

A mistake commonly made by gold and silver bugs, especially those close
to or involved in the mining industry is to become “wed” to the sector
to the exclusion of most everything else. This habit has ruined a good
many investors in the Precious Metals sector in recent years. Investing
should be regarded as an “opportunity cost game,” where you seek always
to maximize your returns within a given time frame consistent with an
acceptable level of risk. This is the philosophy on clivemaund.com, which
is why we made a detour into the marijuana sector last year ahead of
the legalization votes, when it boomed, and why we have invested in a
variety of different sectors and stocks this year, notably the Biotech
and Medical sector. There is no need to wait around on the Precious
Metals sector to start a major uptrend, when, apart from individual
outstanding opportunities in the sector than can occur at any time, it
is possible to go with whatever is performing in the here and now.

We have had a number of outstanding successes in recent months and weeks
where we traded on the basis of some very clear and useful chart
patterns and signals, and a number of our stocks have produced some
classic examples of chart patterns involving different types of
candlesticks and price and volume patterns, often in combination, in the
recent past. There is one in particular that I would like to draw your
attention to in CHART SCHOOL – Gravestone Doji and Parabolic Blowoff calls a top,
where just on the one chart going back 4-months we see a dramatic
confluence of different factors—candlesticks, parabolic slingshot,
various oscillators and the volume pattern all calling a top RIGHT NOW
for a particular stock, and this also provides examples of breakaway
gaps and a Flag. We sold this stock on Friday. To take a look at its
chart, all you have to do is click on the link above, and for a good
measure a couple of other interesting chart examples that we traded are
included in this article, which is intended to be educational.

Hope you like what you see.

Clive Maund has been president of http://www.clivemaund.com, a successful resource sector website, since its inception in 2003. He has 30 years’ experience in technical analysis and has worked for banks, commodity brokers and stockbrokers in the City of London. He holds a Diploma in Technical Analysis from the UK Society of Technical Analysts.

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Charts provided by the author.

from The Gold Report – Streetwise Exclusive Articles Full Text https://www.streetwisereports.com/pub/na/17768