Today one of the greats said the move in gold, silver and the miners may be real and much bigger than people expect.
This Gold, Silver & Miner Move May Be Real
By Bill Fleckenstein President Of Fleckenstein Capital
October 2 (King World News) – The market was basically nowhere through midday, although the Dow was a bit higher. In the afternoon, the Nasdaq was lower with only the Dow gaining a little ground as of an hour to go, when I had to leave. (Meanwhile, the Russell 2000 was suspiciously weak for the second day in a row.) Please check the box score in case anything wild happened late in the day…
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Away from stocks, green paper was higher, as was fixed income, oil was flat, while the metals came to life, led by silver, which added 1.5% as gold gained 1%. However, as gold bulls are aware, for the last six months every squiggle higher has been a head-fake, but I think this one has the best chance of being real simply because of the action in silver and the setup in the miners.
Don’t Fall For It
On the other hand, the Commitment of Traders report has been supportive for five weeks now and that hasn’t helped, but sometimes when something that “ought” to matter doesn’t and then finally does, it can result in a much bigger move.
It is worth noting that there was no news to account for the action today. In fact, it is rather perverse that a rally like this occurred when China was closed for “golden week” and the Wall Street Journal ran a story showing that October is historically a consistently bad month for precious metals. Sometimes when things happen that “shouldn’t,” it is an even bigger statement than when markets move on news.
This is Only a Test
I don’t want to get too far ahead of myself, due to all the head-fakery we have already endured, but for what it’s worth I added a little exposure today, although if it doesn’t work I will be forced to kick everything back out.
Goldcorp & Gold Stocks
Question: Even a Morningstar analyst gets it in the article, “Cryptocurrencies Won’t Dull Gold’s Shine”. Includes a strong recommendation for GG:
“Goldcorp standing out as a unique long opportunity. Trading nearly 40% below our fair value estimate, we think the market is underestimating Goldcorp’s 20/20/20 growth plan. The plan aims to achieve a 20% gold production increase, a 20% gold reserves increase, and a 20% all-in sustaining cost decrease by 2021. Because the improvement plan mainly involves brownfield projects at existing mines rather than greenfield developments, we see the targets as achievable.”
Answer from Fleck: “I don’t think gold stocks in general have ever been this cheap.”
***KWN has released the powerful audio interview with Gerald Celente and you can listen to it by CLICKING HERE OR ON THE IMAGE BELOW.
***To subscribe to Bill Fleckenstein’s fascinating Daily Thoughts CLICK HERE.
ALSO JUST RELEASED: Gold Spikes $19, Silver 40 Cents. Legend Connected In China At The Highest Levels Says Price Of Gold May Spike To $1,345! CLICK HERE TO READ.
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