Monday, 7 December 2015

Miners boosted

American stock markets rallied towards the Friday close, the late recovery however didn't make up for prior losses culminating in the Thursday slide.

Precious metals weakened on Wednesday, but a recovery rally towards the WE improved sentiment. Gold closes at $1086.3 on Friday, up 2.8% over the week, while silver ($14.55) and palladium ($564) add over 3%. The heavily battered platinum ($877) even recovers over 5%.  Predictably, miners are boosted accross the board: the HUI index (121.4) adds 13% relative to last week, making HUI/Gold firm to 0.112. This ratio was last seen by the October 27, however we needed gold quoting at $1155 back then. It's illustrative for the the PM miners strengthening intrinsicly. You find updated graphs on the gold miner pulse blog page.
The embryonic evolvement of this nascent miner recovery was reported on in last week's (Nov 30) posting "Miners start telling a different story" on the TFMetals forum miner thread.

Stronger PM's are partly due to the USD rally faltering: last week the greenback seemed on its way to parity against the euro, but after failing to take out the March high on Thursday a reversal set in.
This also implies that our GoldMinerPulse based indices (with mainly CAD quotes) rally less strongly than does the HUI. The same accounts for our benchmarks in USD rallying between 4.7% for GLDX to 10.5% for GDX which outperform our contributor driven explorer & junior miner spreadsheet (+3%), which is trimming its long term loss to 54.14%. Advances outnumber declines 10 to 6 on the list, with Pilot Gold flat over the week. PLG sliding close to 20% is a major drag on the list performance: the 28% recovery for Wellgreen platinum is needed to flatten it out.

Among our benchmarks, DUST, the 3x levered PM miner bear ETF, slid into the red again. These speculative vehicles never are good investments over the medium or longer term: whatever you gain being right directionally, you may lose to volatility.

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