Good Morning!

It has been a heck of a last year for precious metals. 

A year ago, Gold broke out from its 13-year cup and handle pattern, and days ago, it reached its measured upside target of $3,000/oz. Quality miners and quality junior mining companies are surging higher.

Silver has moved higher alongside Gold but has not outperformed Gold yet. It has gained roughly the same amount as Gold in the past 13 months. However, since the May 2024 peak, Silver is up only 4% while Gold is up nearly 25%.

Part of the issue is that Gold, after clearing $2100/oz has been able to enjoy blue sky territory (no overhead resistance) while Silver has had to chew through multiple resistance levels between $26 to $35/oz.

When Will Silver Outperform Gold

Silver’s underperformance relative to Gold in recent quarters seems unusual, but a review of history shows that it’s too soon to expect Silver to outperform Gold.

We plot Silver, Gold, and Silver/Gold in the chart below. (Click to enlarge the chart).

Silver is a leveraged bet on Gold, so we focus on Gold’s price action.

The vertical lines mark the start of strong legs higher in Silver against Gold and Silver in nominal terms.

The blue arrows mark points at which Gold tested its 200-day moving average after a breakout.

There are six notable periods of Silver outperformance. Five of the six periods of outperformance began after a breakout in Gold was followed by a correction to its 200-day moving average.

In 1978 and 2003, Silver’s outperformance began immediately after the test of the 200-day moving average. 

In the other three cases (1973, 2010, and 2020), Silver’s outperformance began four months, two months, and two months after the first test of the 200-day moving average.  

Silver in Nominal Terms & Next Monday's Close

The start of each period of outperformance coincided with a major breakout in the Silver price. 

Silver did outperform after it broke $28/oz in 2024 but only briefly.

Moving forward, history argues that Silver would be in position to outperform Gold after the next sector correction, which entails Gold testing its 200-day moving average.

In the meantime, mind the action around $35/oz, which is the stiffest resistance on the way to $50/oz. A monthly close above $35.52 would mark a 14-year high and exceed the monthly high from 1980. 

A quarterly close above $32 would mark the 3rd highest quarterly close in history. The quarter ends on Monday.  

Sponsor Companies

Calibre Mining (CXB.to, CXBMF) has now been acquired by or merged with Equinox Gold (EQX.to, EQX).

The two companies have a combined market cap of ~US $4.75 Billion, but have $1 Billion in debt.

Each company is building its most important and lowest cost mine right now. Both are in Canada, where the Gold price is extremely strong. 

The combined entity could generate EBITDA of $2.50 Billion at $2900 Gold in 2026. The combo could grow its production +60% from 2024 to 2026. 

In short, if these two mines have no major issues or significant delays and Gold continues to trend higher, the new Equinox should be a sector leader. But given the debt load, any hiccups that require significant future capital investment will hurt the stock.

GoGold Resources (GGD.to, GLGDF) is currently a small Silver producer with a pipeline of two development projects. Its CEO Brad Langille owns a large position in the company and has a very strong track record.

The company is attractively priced and in position to produce 9M oz Silver-equivalent/year in a few years, with another development project that could take it to 16-17M oz Silver-equivalent.

The stock is acting very well. On December 22, 2024 we called a buy on the stock at C$1.10. We noted it was extremely oversold. The stock is up 63% since then.

For more analysis of these companies and many more companies, subscribe to TheDailyGold Premium.

In TheDailyGold Premium....

In TDG #927 we focused on Silver and silver stocks.

The update included a table of some 13 junior silver stocks we do not own. The table included market cap, cash and notes on each company.

At present, there is a clear top 3 junior silver stocks. (All are in our Top10 Companies). 

Most of the smaller juniors don't have a shot to be a future leader because they lack one of the keys. The three keys are size, grade and potential to be a mine.

We noted two smaller juniors that fit two of those three markers. But can they grow to 100M oz Ag-eq (no base metals)? That is the key. But it's the easiest marker because you can't change grade and you can't change a flaw that prevents the project from being built.  

Here is part of our summary:

Gold reached its measured upside target of $3050 while Silver

touched $35 last week before closing at $3361. The gold stock

indices are breaking out on the back of Gold’s recent breakout

against the 60/40 Portfolio and stock market. More money will come

into miners.

The breadth indicators for miners will inform as to when we are at risk of an intermediate term peak and correction. The 20-day EMA of new highs in GDX & GDXJ is 18% and 12% respectively. The 2016 and 2020 peaks were 36% and 33% for GDX and 33% and 28% for GDXJ. So there is room to move higher and the same can be said based on the 50-day moving average of closes above the 200-day moving average (p19-p20).

What are people saying about TheDailyGold Premium right now?

"Jordans The Daily Gold is the best newsletter in the business, and Ive been in this sector since Oct 2002" -JettPeters3470 (YouTube)

"I believe you do a better job at what you do than any other letter that I know of. Keep up the good work!"- TDG Subscriber

"I have subscribed to a lot of precious metal resource newsletters (redacted / redacted / redacted / redacted / redacted Etc(at least two more)) but yours is the best.  I would love to write a testimonial about my experience".- TDG Subscriber

"I’ve followed you for years and I can unreservedly say that you’re the best analyst in precious metals there is" - evacox-FM7ze (YouTube)

"Jordan I want to thank you for everything you contribute: your timely YouTube's, your detailed and well organized newsletters (summarized in various places so I can just scan  if/when I don't have time to read everything Sunday/Monday, your EXCELLENT and amazingly accurate analyses of the charts, and your generosity in sharing HONEST guidance and wisdom. 

I have purchased many newsletters over the past 15 years and yours is hands down the BEST, and for the most reasonable price!! Newsletter writers often either don't understand markets, market timing or charts and/or write way too much such that important conclusions or guidance is basically buried in details that regular people like me (who aren't geologists) can't decipher.... resulting in trying to find the gems of important information buried in mountains of verbiage".- TDG Subscriber

Thank you for reading.

I wish you all the best in 2025 and beyond.