dive plungeSilver’s young bull market got off to a typically-slow start, lagging gold’s own new bull.  But recently the white metal surged to catch up in a record summer rally.  That left silver very overbought and facing near-term correction risks led by a record futures selling overhang and weak late-summer seasonals.  But this strengthening bull still has a long ways higher to run yet before silver prices reflect prevailing gold levels.
Just like gold, silver faces a record futures selling overhang today…

cliff edgeGold’s mighty new bull market this year has been amazing, the result of heavy buying by investors and speculators alike.  But these latter traders have pumped so much capital into gold futures that this metal now faces a record selling overhang.  Since the hyper-leveraged nature of futures trading demands an ultra-short-term focus, speculators’ excessive bullish bets on gold pose major near-term downside risks.

heatMid-bull selloffs after big moves higher are common, re-balancing sentiment which greatly extends bull lifespans.
They offer the best opportunities for traders to add new positions at relatively-low prices. 
And make no mistake, gold stocks remain super-low absolutely and relative to the metal driving their profits.
2016’s dazzling new gold-stock bull remains young, with years left to run yet before it matures then peaks.

Stock chart growth

Stock chart growth

One of the primary keys to success in investment and speculation is picking the right stocks to trade.  That’s no mean feat, as it takes great effort, expertise, and time to winnow the whole field down to the likely winners with the best fundamentals.  Gold stocks’ dazzling market-leading performances so far this year have sparked much interest in what factors to consider to pick great stocks in this red-hot sector…

summerThe entire precious-metals complex has enjoyed record early-summer strength (even prior to Friday’s HUGE BREXIT move).  The summer doldrums have always been a vexing time for gold, silver, and the stocks of their miners.  Without any recurring seasonal demand surges in June and July, sideways-to-lower drifts are common in this seasonally-weakest time before big autumn rallies.
Will This Summer Be Different?

summerThe red-hot gold stocks surged again this week in an apparent early-summer breakout.  This strong buying is defying their seasonally-weak odds this time of year.  Investors are flocking back to the miners as gold powers higher on also-counter-seasonal strong investment buying.  Such unprecedented gold-stock strength in early June highlights how undervalued the miners remain relative to gold, but is suspect…

Caption Contest 1Gold’s reversal of fortune over the past half-year has been epic.  The strong gains so far this year have been overwhelmingly fueled by one dominant driver, massive investment buying.  After shunning prudent portfolio diversification with gold for years, investors are finally starting to reestablish those essential positions.
And since their collective gold holdings were so incredibly low heading into 2016, reflecting hyper-bearish sentiment, gold’s investment buying has only just begun…

The smaller gold-mining and exploration stocks have enjoyed an amazing year, soaring with gold’s new bull market.
Many have more than doubled since mid-January, and some have more than tripled at best in that short span.
Are such spectacular gains fundamentally-justified, or merely the result of ephemeral sentiment that could vanish anytime?
The gold juniors’ recently-reported Q1’16 results offer great insights…

imageThe gold miners’ stocks have skyrocketed this year as investors started returning to this long-abandoned sector.
Many have doubled since January, with plenty tripling or even quadrupling.
Naturally such fast gains raise concerns about whether they are actually fundamentally justified or merely the product of fleeting sentiment that could reverse.
Gold miners’ latest quarterly results offer great fundamental insights.

cliff edgeThe gold-mining stocks have skyrocketed this year, radically outperforming every other sector. 
Smart contrarians who bought them low late last year and in January have seen their capital doubled, tripled, and even quadrupled! 
But such blistering gains raise the ominous specter of crippling overboughtness, conditions preceding major toppings.  Have gold stocks come too far too fast to continue their epic run?

silverSince silver’s overwhelmingly-dominant driver is gold, the white metal followed the yellow metal lower.  Just several days before gold’s secular low in mid-December, silver dropped to a dismal 6.4-year secular low of its own.  Q4’15’s average silver price of $14.77 was the worst since Q3’09’s $14.72.  Silver was perfectly fulfilling its traditional role of acting like a gold sentiment gauge, tracking its driver into the abyss…

icebergSilver officially entered a new bull market this week, decisively crossing the necessary +20% threshold.  Speculators and investors alike are returning as awareness spreads of how radically undervalued silver is compared to prevailing gold prices.
When silver awakens to a new bull market after a long bearish slumber, massive gains are usually unleashed.
Silver’s tiny advance so far is just the tip of the iceberg…

rocketGold has spent much of the past couple months consolidating, vexing traders and bleeding away most of early 2016’s enthusiasm that catapulted the yellow metal higher.  But this sideways grind has actually been a very impressive show of strength.  Gold managed to hold its massive gains despite an incredible stock-market rally, which can really sap gold investment demand.
This portends another MAJOR gold upleg:

beach ballSilver’s reluctant, sluggish participation in early 2016’s powerful gold rally has been glaringly obvious.  Instead of amplifying the yellow metal’s big gains as in the past, silver largely failed to even keep pace.  The lack of silver confirmation for gold’s big move has certainly raised concerns.
But despite silver’s vexing torpidity in recent months, it is a coiled spring ready to explode higher to catch and surpass gold.

rocketThe red-hot gold stocks have spent most of March in consolidation mode, grinding sideways near their 2016 highs.  Interestingly this month’s rally pause is par for the course seasonally in gold-stock bull markets.  Like gold itself, this sector tends to slump to a seasonal low in mid-March before embarking on a strong spring rally in April and May.  With gold stocks back in a bull, their seasonality warrants consideration.
Is a BIG SPRING RALLY Dead Ahead?

gold bullGold stocks have radically outperformed every other sector in the stock markets this year, blasting higher as investors flock back to gold.  This powerful surge is spawning worries that gold stocks’ new bull run is in danger of exhausting itself.  But such fears are totally unfounded.  A longer-term perspective reveals that gold stocks’ baby bull market in 2016 remains tiny in the grand scheme.
This new bull has barely begun:

fight smashWith gold miners’ stock prices surging dramatically this year, investors’ attention is starting to return to the gold juniors.  These smaller miners and explorers suffered terribly in recent years, all but abandoned as gold slumped to major secular lows.  But even during gold’s darkest quarter, the fundamentals of the juniors actually mining gold remained quite strong.  This portends explosive profits growth as gold recovers.

gold bullGold’s powerful surge in 2016 has been driven by utterly massive investment buying.  This is a marked sea change from recent years, where investors relentlessly pulled capital out of gold.  But with that dire sentiment reversing, they are rushing back in with a vengeance.  Major investment capital inflows into gold are an exceedingly-bullish omen, as they are what transform a mere gold rally into a new bull market.

Zeal022616AWith the gold-mining sector’s market-dominating outperformance this year, investors are searching for the best-of-breed gold miners.  The elite mid-tier OceanaGold is certainly among them.  OceanaGold has truly epic fundamentals, combining super-profitable low-cost gold production with a solid balance sheet and great growth potential.  Gold-stock investors really need to seriously consider this gem for their portfolios.

The gold miners’ stocks have soared this year as investors flock back into this long-abandoned sector.  Many traders wonder if these eye-popping gains are merely the product of fleeting sentiment that could reverse anytime, or are supported by strong underlying fundamentals.  With the gold miners reporting their latest quarterly operating results, this extensive new data offers great insights into gold mining’s fundamentals.

rocketGold and its miners’ stocks are rocketing higher as speculators and investors alike return to this left-for-dead sector.  This sudden deluge of capital inflows has crowned gold stocks the best-performing sector of this young new year by far, shocking traders!
And this stunning reversal of fortunes in both the metal and the companies producing it is only starting, so it’s exceedingly important to understand what’s going on.