Last Friday we witnessed a magnificent miner rally as gold broke above $1300 for the first time since mid June 2018. However, miners have been disappointing for most of the past 18 months. There is no obvious reason why this dire situation would suddenly improve.
Saturday, 26 January 2019
Saturday, 29 December 2018
Short 2018 mining reviewEarly last year we witnessed gold rallying rapidly to what was to be its 2018 high. Till about mid May, the yellow metal managed to uphold $1300. Miners however have mostly been lagging the advance of gold, with the HUI/Gold ratio in decline and bottoming early September, after gold made its low by mid August.
Friday, 30 November 2018
Diverging price trends among precious metalsPrecious metals in a downtrend over 2018 is a story of the more obvious. The failing gold rally early in the year and the breakdown of silver leading to a gold/silver ratio now over 86. Platinum is another horror story: longs were lured in a failing rally of this denser precious metal. Yet by mid August, platinum plunged to $767. Even during the four year gold bear market, platinum had not seen such price level. Today (30 Nov), Platinum again is to close below $800/Oz, making the Gold/Platinum ratio rise to 1.533. Two ounces of gold now buy over three ounces of platinum.
Wednesday, 31 October 2018
The Randgold - Barrick merger lifted enthusiasm within the mining sector. As the metal turned up with gold breaking and holding above $1200/Oz (despite a rising USD and interest rates creeping up), miners seemed ready for a lengthy rally, especially after HUI/Gold completed an inverted head and shoulders pattern.
Saturday, 29 September 2018
Sunday, 26 August 2018
Mid August, the HUI miner index plunged to 139: beneath both the Dec 12, 2017 bottom (175) and the Dec 15, 2016 bottom at 163.5. After Friday's rally HUI now posts at 146.8, which still is well below said bottoms. The recovery rally merely alleviates the pain but it doesn't cure the disease.
Sunday, 8 July 2018
White precious metals lagging gold
Despite gold selling off last few weeks, the damage among "white precious metals" has been worse.
The gold sell-off was discussed last week, as the yellow metal was nearing its December 2017 low, which it eventually equalled on July 2nd.
Wednesday, 27 June 2018
Monday, 21 May 2018
- What should we remember from the PDAC 2018?
- Why didn't I come up with this any sooner?
Tuesday, 24 April 2018
Previous few postings have warned against betting on leverage when investing in gold mining stocks. Miners occasionally outperform when gold rallies really get traction. They sometimes prove a decent investment when a substantial number of influential investors are convinced that the bottom is in for the gold price. However, miners more often lag the metal while it's rising or slide precipitously upon gold weakening. The focus now shifts to statistics on individual miners: both success stories and horrendous nightmares.