For weeks I have been telling subscribers hat I have been waiting for a bullish reversal on volume to enter the precious metals market.
That time may have come on March 18th when I sent out a report to my premium subscribers that that gold turned bullish as The Fed was much more cautious about raising interest rates than the market expected due to the weakening of the overall global economy. This is the chart I sent them indicating gold was due for a major bounce and strong follow through accumulation.
Gold bounced off November lows on good volume on March 18th. Since then we have witnessed strong accumulation days signaling follow through. The US Dollar may have recently topped with heavy duty selling.
This may have been a classic double bottom in gold as investors realize that the Fed may not move quickly to raise rates as the overall economy is weak and unemployment remains high.
Oil is in a downtrend crashing to the low 40′s and copper prices are near multiyear lows but that may change soon as well. I expect a major relief rally in commodities as the majority of investors who went to cash expecting a commodity crash on higher interest rates will have to panic back in as they realize that the exact opposite may occur.
Precious metals and commodities could be forming a major bottom as the Central Banks will be forced to keep the printing press churning devaluing the US dollar to keep pace with the moribund Euro and Yen. The global economy is under pressure according to these metals and most fiat currencies will continue to decline.
A highly valued US dollar and stock market is not a reflection of the underlying fundamentals and an economic recovery. Large cap S&P500 companies are soaring to new highs on the back of higher profit margins due to cutbacks and layoffs.
The Fed continues to point to weaker economic data most notably from the shell shocked energy sector which has been a big driver of the recovery up until this point. This is suggesting that rate increases may be much farther off than most expected.
Gold is in the midst of a major rally, which may turn into a major trend change where capital flows from overvalued US stocks, dollars and bonds into commodities, precious metals and energy. Now it is time to look at the high quality junior gold miners. I like to see serious up-trends trading above its 50 and 200 day moving average.
These are some of my junior gold stocks that I own and investors are taking seriously right now as they could outperform the Junior Gold Miner ETF (GDXJ) in the 2nd Qtr . They are also sponsors on my website.
The six juniors are as follows:
Pershing Gold Corp. (
OBB: PGLC,
Stock Forum)
Integra Gold Corp. (
TSX: V.ICG,
Stock Forum)
Red Eagle Mining Corp. (
TSX: V.RD,
Stock Forum)
Camamex Resources Corp. (
TSX: V.CSQ,
Stock Forum)
Corvus Gold Inc. (
TSX: T.KOR,
Stock Forum)
International Tower Hill Mines Ltd. (
TSX: T.ITH,
Stock Forum)
Disclosure: I own all the companies mentioned and they are all website sponsors. This is not a recommendation to buy or sell securities. I am not a registered financial adviser. Conflicts of interest apply as I would benefit if these stocks move higher. Please do your own due diligence.