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Since the macro often gets its pants in a bunch over FOMC, let’s see what these 3 economic metals have to say about the Fed’s nothing burger yesterday. Let’s use daily futures charts of gold and silver and daily, weekly and monthly charts for copper for perspective on the macro.
It’s very interesting to see what’s going on with gold miners these days. The triple bearish on miners fund, symbol DUST, broken its bullish triangle a little more than a week ago, and it’s been obediently below its now-broken trendline. I view this as bullish for miners in the weeks ahead.
It looks like the precious metals miners have a good shot at success. Look at what has happened to the triple-bearish fund DUST. It had been shaping up to be a potential bullish breakout, but a few days ago, it cut below its ascending trendline. On top of that, it’s got a bearish engulfing pattern today. In other words, the bearishness of this pattern suggests good times ahead for miners.
Before looking at some individual mining prospects, a word about GDX: Consider that NEM and GOLD comprise 21.8% of GDX. These two companies both purchased rival companies is 2019: In January, GOLD acquired Randgold, a $6.5b deal, and in April, NEM purchased its top rival, Goldcorp, for $10b.
If invested in GDX, keep tabs on exploration costs and production of NEM and GOLD to monitor their strength. It is an increasing challenge for them to find new gold to mine economically at the scale and pace their size demands.
(more…)I have been thumbing through the futures graphs in SlopeCharts, and I found copper to be especially interesting. Should it fail that trendline, it would commence a much more serious slip in prices.
