gold and silver will stay under pressure. BUT, Econ 101 says that silver mines will start to shut down around $12 an ounce, so I just don't see too much downside left after dropping from $48 to $15 even if the dollar continues higher. Bear is four years old and has crushed the miners. Sentiment is very negative. I somehow think we're not far from a bottom. We'll see. I just scale in on weakness and scale out on bounces. When this bear is done, things will get far easier, but right now its tough to make much on these small bounces and bigger drops.
SLV works as advertised and yes, it invests in real silver bullion. PSLV is a better mousetrap, though, that I prefer when there is little or no premium. Bullion banks are simple and straight-forward and work. By the way, silver and gold will always be priced in US dollars, you know, real money that buys real things. As the US dollar gets stronger it hurts all commodities.
They'll keep mining it if they can make a profit doing it. Its speculation as to new discoveries. Unless you're waiting twenty years, I'm not sure it matters. Remember peak oil? Now less than $50 a barrel. Near term, we'll see far less expansion at these prices with oil wells drilled and new gold/silver mines developed.
NUGT is for gamblers, GDX isn't far behind. GG is the only 'quality' gold miner of size. GG tracks GDX but in theory offers better downside protection due to its assets and balance sheet. Downside protection is always important in this bear market. We now are seeing big pops and not just drops, so miners seem to be getting washed out down here. Gold prices still call the shots for the industry. I grabbed a block at $18+ and I'll average down as allowed. Next pop almost guaranteed to be at least back to $21ish. Last pop from $17 to $25 good for almost a 50% gain. I like GG but nothing else in the industry so I skip GDX even though they move in tandem for the most part.
Take a look at PSLV, fully allocated and stored at the Royal Canadian Mint. Just switched from SLV to PSLV as I usually do when the premium shrinks towards zero with PSLV. But the reality is that the bullion funds will track spot silver, plain and simple. After all, 99% of your trust assets is silver ingots in a secure vault with 1% in cash. It'll track spot, and the options market won't blow up, btw. Its really a small market for silver. A pittance for a JPM.
We might slip to $15 or even $14 first, but then we'll bounce to $21! GG is in a range where you'll get nearly 50% rallies off lows. GG is the only investment grade miner imo with good assets, a good balance sheet and good management. That's important if gold prices drop further. Last bounce from $17 to $25 was sweet, we'll see what the next one looks like.
ever since GG got to the low $20s. Current low of $17 might lead to a new low of $15 but then it'll bounce 50% to 22 1/2. Last bounce from $17 to nearly $25 was good for almost 50%. Accumulate in the teens and sell the bounces is a good strategy here imo. GG is the best of a bad bunch. ABX is swamped with debt and GDX is littered with issues. GG still shadows GDX down here, but its the best of the bunch.
The bounces are quite profitable when you pick up shares near lows. Last bounce from 17 to 25 was close to a 50% pop. We will get more bounces going forward off oversold levels. GG is the only investment grade miner imo due to its strong balance sheet, assets and management. ABX is swamped with debt.
POT will wind down expansion spending and increase free cash flow going forward. A 5% dividend (if stable) sets a floor on the share price imo. $30+ and better remains the value play accumulate number for POT.
Lots of unpaid loans, lots of indebted drop-outs and federal subsidies wasted, and fairly worthless degrees to the few that do get one. A for-profit trolling on-line university is not a god business. Just imo!!
Nobody wants the oil market flooded for the next nine months with storage filling up on the glut already. Significant damage to exploration budgets has already been achieved by the Saudis. The US oil rig count says it all.The only question is does OPEC cut at their June 5th meeting. Summer driving demand and a cut in production by OPEC would turn things around quickly in just over two months. If we get no cut, we endure more pain. Saudis don't want to single-handedly cut while everyone else in OPEC and Russia continue to pump a lot. Lots of cheaters on production quotas out there. If Iran starts pumping more with an agreement on nuclear talks, that also could be a production boost that worsens the glut. Have to see how things play out, but there is no way any OPEC country wants these low oil prices to stay in place too long. They just want exploration and future production capacity cut and Saudis can force the issue.
I agree that the Fed really doesn't have reason to tighten and the dollar strength is only going to slow S&P 500 earnings when overseas profits translate into fewer dollars. Exports become more expensive and imports become cheaper, which will also slow US growth. The dollar strength will show up in Q1 earnings as we're now looking at a much stronger year-over-year dollar. With everyone else loosening money, we're swimming against the tide just by being neutral on monetary policy.
Implode against what - the Euro or Ruble or Yen? Central Banks are pushing down the currencies against the dollar like we're in a deflationary period, which we pretty much are. Countries sell better to the US when their currency is cheap relative to the dollar.
$46ish is a key support level that might hold. We'll see. This thing has been falling like a rock (or like the US oil rig count chart) and its downward mojo has been very strong. The vicious fall will stop at some point, but when and where is not known. I bought near $50/$48/$46 so far on this slide in the forties. I was lucky to push in the fifties, and now I'm trying again in the forties. I say we won't see the $30s any time soon, but I was wrong about the fifties...
longs could be in deep doo-doo. I'm in for another few shares as we seemingly blow through the $40s. Gee, hard to believe not long ago I thought under $60 was good!
from the recent high. We'll close in on the most bearish price target of $40 real soon at the rate we're going. Who knows? I pushed trading the $50s and I may end up pushing on the $40s. I won't want to trade shares in the $30s if we get there. Down $50 and I'll want to start buying more than just a few and hold 'em.
Commodities don't seem to have a chance lately. Econ 101 will effect oil, silver and gold production but it always takes a long time to happen. The strong dollar is crushing commodities.
and so are the drillers at the epicenter of the industry slowdown. I pushed in the $50s and we'll see if the $40s work better. At the rate we're going, we might see the $30s before this meltdown is over. NOV will survive and eventually thrive again, but it could be a while before that happens! Good Luck to Longs, because we seem to need some!
Its plain and simple. S&P 500 earnings will see some headwinds from overseas profits translating back into fewer dollars, so it will also slow down equities eventually. The dollar won't go up forever, but its almost at parity with the Euro. Euro is down 25% in nine months!