In this issue...
- Editorials
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Editorials...
Today's editorial: New Cyclical Bull Underway in Gold Stocks
The cyclical bear market is over and we, using the HUI and our Silver stock index, compare it to the past cyclical bears (from this bull market and the 1960-1980 bull). With sentiment and valuation metrics near 10-year lows, its rather obvious why this sector is at the start of what should be a multi-year cyclical bull.
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Yesterday we published a 24-page update on Silver and the silver stocks. Our update included reports on two silver companies: one of which we recommended an initial position in last week and the other we visited on a property tour last week.
Before we get to that, here is a chart of our proprietary 10 stock silver producer index. We highlight the cyclical bear markets. The index is currently at four-month resistance. A pullback could setup another attempt at a breakout which if successful would lead to another leg higher. These three bear markets were 60%, 90% and 50%. So the recent bear market, which we assume has completed, was actually the smallest in terms of losses. Moreover, it could be the "handle" on this potentially monstrous cup and handle pattern which has very bullish implications- if we are indeed set to begin another multi-year cyclical bull market.
Now stock selection is very important. If the sector/market is bullish, you will profit more if you can find the leader or leaders. Back in 2009-2010, First Majestic was our top pick. Click the link for evidence of how bullish we were before the stock shot multiples higher. I don't know if there is another First Majestic in the silver sector but we have identified a Gold company which we've lightly compared to FM.
Getting back to Silver, we purchased our current favorite Silver stock in July. Unfortunately, it decided to launch substantially higher and now we are waiting for a pullback to add to the position. Secondly, we added a position in another Silver company which we believe has seen its bottom and has a tremendous long-term reward vs. risk potential. That is the setup we all hope to find and we believe we found it. (That was one of the companies we reported on). The second company report (our trip) is a company which will become a new Silver producer (in 18 months), right here in the USA! Expect to hear a lot more about this company (from others) in the coming weeks. Another advantage of subscribing to our premium service is you occasionally will be among the first to hear about new companies and new deals.
Lastly, yesterday we advised buying into a Gold exploration company which we believe has a good shot to be up 150-200% in the next year to 18 months.
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Wishing you health and profits,
Jordan
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