Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Stock Market January PANIC AI Tech Stocks Buying Opp - Trend Forecast 2022 - 21st Jan 21
How to Get Rich in the MetaVerse - 20th Jan 21
Should you Buy Payment Disruptor Stocks in 2022? - 20th Jan 21
2022 the Year of Smart devices, Electric Vehicles, and AI Startups - 20th Jan 21
Oil Markets More Animated by Geopolitics, Supply, and Demand - 20th Jan 21
WARNING - AI STOCK MARKET CRASH / BEAR SWITCH TRIGGERED! - 19th Jan 22
Fake It Till You Make It: Will Silver’s Motto Work on Gold? - 19th Jan 22
Crude Oil Smashing Stocks - 19th Jan 22
US Stagflation: The Global Risk of 2022 - 19th Jan 22
Stock Market Trend Forecast Early 2022 - Tech Growth Value Stocks Rotation - 18th Jan 22
Stock Market Sentiment Speaks: Are We Setting Up For A 'Mini-Crash'? - 18th Jan 22
Mobile Sports Betting is on a rise: Here’s why - 18th Jan 22
Exponential AI Stocks Mega-trend - 17th Jan 22
THE NEXT BITCOIN - 17th Jan 22
Gold Price Predictions for 2022 - 17th Jan 22
How Do Debt Relief Services Work To Reduce The Amount You Owe? - 17th Jan 22
RIVIAN IPO Illustrates We are in the Mother of all Stock Market Bubbles - 16th Jan 22
All Market Eyes on Copper - 16th Jan 22
The US Dollar Had a Slip-Up, but Gold Turned a Blind Eye to It - 16th Jan 22
A Stock Market Top for the Ages - 16th Jan 22
FREETRADE - Stock Investing Platform, the Good, Bad and Ugly Review, Free Shares, Cancelled Orders - 15th Jan 22
WD 14tb My Book External Drive Unboxing, Testing and Benchmark Performance Amazon Buy Review - 15th Jan 22
Toyland Ferris Wheel Birthday Fun at Gulliver's Rother Valley UK Theme Park 2022 - 15th Jan 22
What You Should Know About a TailoredPay High Risk Merchant Account - 15th Jan 22
Best Metaverse Tech Stocks Investing for 2022 and Beyond - 14th Jan 22
Gold Price Lagging Inflation - 14th Jan 22
Get Your Startup Idea Up And Running With These 7 Tips - 14th Jan 22
What Happens When Your Flight Gets Cancelled in the UK? - 14th Jan 22
How to Profit from 2022’s Biggest Trend Reversal - 11th Jan 22
Stock Market Sentiment Speaks: Are We Ready To Drop To 4400SPX? - 11th Jan 22
What's the Role of an Affiliate Marketer? - 11th Jan 22
Essential Things To Know Before You Set Up A Limited Liability Company - 11th Jan 22
NVIDIA THE KING OF THE METAVERSE! - 10th Jan 22
Fiscal and Monetary Cliffs Have Arrived - 10th Jan 22
The Meteoric Rise of Investing in Trading Cards - 10th Jan 22
IBM The REAL Quantum Metaverse STOCK! - 9th Jan 22
WARNING Failing NVME2 M2 SSD Drives Can Prevent Systems From Booting - Corsair MP600 - 9th Jan 22
The Fed’s inflated cake and a ‘quant’ of history - 9th Jan 22
NVME M2 SSD FAILURE WARNING Signs - Corsair MP600 1tb Drive - 9th Jan 22
Meadowhall Sheffield Christmas Lights 2021 Shopping - Before the Switch on - 9th Jan 22
How Does Insurance Work In Europe? Find Out Here - 9th Jan 22
MATTERPORT (MTTR) - DIGITIZING THE REAL WORLD - METAVERSE INVESTING 2022 - 7th Jan 22
Effect of Deflation On The Gold Price - 7th Jan 22
Stock Market 2022 Requires Different Strategies For Traders/Investors - 7th Jan 22
Old Man Winter Will Stimulate Natural Gas and Heating Oil Demand - 7th Jan 22
Is The Lazy Stock Market Bull Strategy Worth Considering? - 7th Jan 22
METAVERSE - NEW LIFE FOR SONY AGEING GAMING GIANT? - 6th Jan 2022
What Elliott Waves Show for Asia Pacific Stock and Financial Markets 2022 - 6th Jan 2022
Why You Should Register Your Company - 6th Jan 2022
4 Ways to Invest in Silver for 2022 - 6th Jan 2022
UNITY (U) - Metaverse Stock Analysis Investing for 2022 and Beyond - 5th Jan 2022
Stock Market Staving Off Risk-Off - 5th Jan 2022
Gold and Silver Still Hungover After New Year’s Eve - 5th Jan 2022
S&P 500 In an Uncharted Territory, But Is Sky the Limit? - 5th Jan 2022

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Ready for New Year 2017 Massive Rally in Gold and SIlve rand Junior Miners

Commodities / Gold and Silver Stocks 2017 Dec 31, 2016 - 01:14 PM GMT

By: Jeb_Handwerger

Commodities

The Trump presidential election win has pushed capital into a major risk on rally, benefiting stocks, energy and the US dollar.

Interest rates are soaring in line with the Dow breaking 20k indicating major inflationary pressures.

Commodities such as industrial metals, copper and oil are rallying.


The junior gold miners could be on the verge of breaking a six-month downtrend.

A few weeks ago, in an article titled, "Is A Year-End Reversal Forming For The Junior Gold And Silver Miners?" I attached the following chart.

In the article, I wrote "The precious metals are very oversold and ripe for a reversal as they usually bottom at year-end then have massive rallies in the new year. This seasonal pattern has been strong even during this bear market."

Now two weeks later, it appears gold may have bounced off its support and is making some bullish reversals as shown on the charts. I am closely following to see if the junior miners can break the recent downtrend and regain the 200-day moving average in the new year confirming a new bull market rally.

This could set up for its next bull rally like it did in 2016. Despite this downward correction, the junior gold miners are outperforming stocks (NYSEARCA:SPY) and bonds (NYSEARCA:TLT) on the year.

The markets are pricing in inflation following the Trump presidential election win and that should benefit metals. U.S. stocks are soaring to record highs and the Dow is on the verge of breaking 20k, a major psychological level. Investors should be prepared for volatility as President Trump will counteract a lot of Obama's moves over the past eight years, which could accelerate moves in many markets.

Notice already that U.S. bonds are breaking down, as capital is flowing to riskier assets, most notably stocks, copper (NYSEARCA:JJC) and energy (NYSEARCA:XLE). To me, this signals inflation, rising interest rates, and major policy changes, which is already having dramatic effects on portfolios.

I am amazed that the U.S. dollar (NYSEARCA:UUP) is still rising despite many bonds crashing. All fiat currencies except the U.S. dollar are crashing. There are even some places around the globe experiencing hyperinflation, most notably Venezuela and India. Investors are dumping their foreign stocks and paper in favor of U.S. Stocks and U.S. dollars.

An artificially high U.S. dollar could stress borrowers who have to pay back loans. Most notably affected could be the U.S. Federal Government, who is already in record debt.

That is why we still love junior gold miners (NYSEARCA:GDXJ) and, even more so, silver miners (NYSEARCA:SIL). Trump will not let foreign nations continue devaluing their currency to gain an advantage on the US.

I expect Trump will do whatever he can to stimulate spending and growth to make America great again, maybe by putting capital into infrastructure. This should benefit the domestic steel (NYSEARCA:SLX), copper (NYSEARCA:COPX) and energy sector.

Attention should be paid to the lithium sector (NYSEARCA:LIT), as well, since Tesla (NASDAQ:TSLA), that recently announced a deal with Panasonic (OTCPK:PCRFY) to manufacture solar cells to be used with the Lithium Ion PowerWalls. This could be the sector which "trumps" the rest over the next decade, bringing thousands of jobs back to the US.

In addition, Trump loves nuclear, and I expect major investments will be made to update and expand our nuclear fleet of reactors. He has already caused a major bounce in the sector after a couple of tweets promoting nuclear energy.

Investors should look to gain exposure to the Uranium Mining ETF (NYSEARCA:URA) as Trump may look to build our domestic nuclear sector since we can no longer rely on imports (especially when we have millions of pounds of uranium in the Southwest). There have been many small uranium miners raising money after the Trump win, which may auger a bottom.

I suggest to continue to follow the tensions in the South China Seas, with the potential theft of a U.S. military drone. Could China have taken that drone to see what rare earths the U.S. was using to power and guide the advanced drones? All the metals which China has control of should be watched closely. Focus on rare earths (NYSEARCA:REMX), graphite, and other strategic battery technology metals such as scandium and cobalt.

Trump has hired Peter Navarro as China trade advisor, and the Chinese are already threatening a trade showdown. Hopefully, Trump will move fast to help secure our own supply chain of critical metals, as that is how the Chinese can squeeze the West.

Take a look at some recent developments in this sector, some of which should be looked at for 2017. Remember that there is no current U.S. production of flake graphite used in high tech batteries. Smart money wants some exposure to fertilizer stocks as inflation increases.

Keep a close eye on silver miners especially deposits with high grade in safer jurisdictions like Canada. Also, British Columbia and the Yukon have some of the highest grade silver in the world. Recently, a junior near-term Yukon gold developer was acquired by Goldcorp (NYSE:GG). Could some of the other big silver producers look to come into Yukon's Keno Hill or British Columbia's Golden Triangle where some of the highest grade silver is found?

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

By Jeb Handwerger

http://goldstocktrades.com

© 2016 Copyright Jeb Handwerger - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in