RE:RE:RE:No trades since 1:27 PM??edmed wrote:
The big correction has finally arrived.
Blood in the streets.
Problem is why gold stocks selling off with the rest?????
People selling everything.......markets never make any sense!
edmed
The gold winners (most gold equities) are being punished based on a margin calls and panic selling by investors of their winners (as they try to lock in the profits on their better plays). Sadly it's perverse psychology at work IMO. An investor says "I'll sell my winners and hold my losers in the hopes they might come back". If 2008/09 is any guide the bounce back will be strong and quick for gold equities as long as gold itself remains the logical safe haven. Not so for the general markets, as the correction will likley last for many months at least...until the Covid-19 headlines start to subside, and or a vaccine looks imminent. Besides the virus, excesses have to be rung out of the general equity market, and they have to get over GDP and earnings declines for many many quarters. Gold equiteis were amoungst the first to bounce back in 2009.
The difference of course this time (2020 vs 2009) is that gold equities (the producers anyway) are now just about to throw off lots of cash. This while gold is nearing its all time highs in USD (and more than likely going higher). Fuel costs (a major input cost for miners) is also falling - thereby increasing margins for th producers. Finally gold equities were/are generally way undervalued to begin with, based on immediate earnings and cashflow horizons. Once the selling pressure starts to subside for ALL equities, cash on the sidelines will likely first flow back to where the earnings will be (Gold equities!). Short term pain for long term gain !
Hope yall kept some powder dry for the "blood on the streets" phase we are entering.
MM