New on Howe Street: "The Grass is Always Greener on the Other Side of the Border"

I did another Howe Street interview with Jim Goddard. You can find it here: http://www.howestreet.com/2017/06/13/paper-gold-vs-real-gold/

In their headline, Howe Street focused on my comments on paper gold vs physical gold. That relates to the chart I posted HERE.

Howe Street is metals focused, and that's fine. But I thought the more interesting part of the interview was what I learned at the Southeast Cannabis Conference and Expo in Ft. Lauderdale.

Here's the thing: I listened to a U.S. hedge fund manager who explained his clients were eager to invest in Canadian cannabis companies. And I listed to a Canadian cannabis fund manager who is putting money to work on the U.S. side of the border.

Both of them had good reasons for what they were doing.

That led me to comment: "The grass is always greener on the other side of the border."

Physical ETFs Load Up on Gold and Silver

I have been neglecting this blog, as I have been working quite a lot.

Here is a brief excerpt from a much longer issue I am sending Red-Hot Resource Millionaire subscribers today.

This is an update of the chart I’ve shown you before. It tracks total holdings of the world’s physical gold and silver ETFs. The black line is silver. The blue line is gold.

You can see investors are using ETFs to stock up on gold, even as the paper price goes lower. In fact, it’s gaining momentum. Gold ETFs have added a whopping 24 metric tons so far in June alone! And they’ve added 110 tons so far in 2017.

ETFs started to sell silver last week. But on Friday they changed their minds. Now they’re adding silver, too.

Obviously, someone thinks gold and silver are cheap at recent levels.

My Latest Howe Street interview

In my publication, Red-Hot Resource Millionaire, I've been recommending new positions in gold and silver developers, explorers and miners since May 4. 

Yesterday, I talked with the folks at Howe Street Radio. And I explained some of what I'm seeing that is driving metals, energy, and more.

Tune in and listen. Or not: http://www.howestreet.com/2017/05/16/silver-getting-more-attention/

2 Must-See Charts on Physical Gold and Silver

Today, I put out a new issue for my Red-Hot Resource Millionaire subscribers. Along with tooting my own horn over the Integra Gold pick -- and you've got to admit, that was well-timed (we bought it May 4), what with Eldorado Gold acquiring the smaller company -- I also gave subscribers a new silver pick.

Why silver? I gave a bunch of reasons, but let me share two with you.

First, here's a chart I made on a Bloomberg terminal of what's going on in the world's physical silver ETFs. Not just the one in the U.S.

Nice move. NOICE! Yeah, silver is becoming more popular, for reasons I detail in the issue.

Now how does this compare to the action in the world's physical gold ETFs? I'm so glad you asked ...

Sure, ETF holdings of gold are climbing. But proportionally, ETFs are buying a heck of a lot more silver.

Combine this with what I’ve told you about before — that the world has hit peak silver, and there are other production pressures on the metal — and you can see silver could go much higher.

Real Interest Rates at a Tipping Point for Gold

I've written about real interest rates a lot for subscribers. So it was nice to see this post and chart by @WFLONGWAVE on Twitter: "Real interest rates were often negative during the run up to 1900, see picture. They were the fundamental driver for the gold bull market."

That's it for now. Busy with today's afternoon column and getting ready for the launch of Red-Hot Resource Millionaire. You can watch a free webinar with all sorts of juicy, interesting gold and miner facts and charts.

Will Gold find support at $1260 or lower? Chart!

Here's a chart I whipped up on Stockcharts. It shows where I see support for gold.



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You can see that price support at $1,260 lines up closely with the 200-day moving average at $1,258.  So we can expect support there.

But what I would prefer is for gold to pull back to deeper support at its uptrend. That might be a great platform for gold and miners to launch higher.

We'll see how it plays out. Good luck and good trades to you.

Sean

Tune in to Learn the Secrets of Gold

I'll be giving a free webinar next week on gold and miners.

It's going to be good.

But you can't watch it yet. You can SIGN UP for it.

... I invite you to join me for an urgent four-part workshop next week. Click here to reserve your FREE seat now

So do that. And I'll talk to you next week.

Update: The webinar is on! The reviews are good. You can watch it here: www.newgoldbull.com

Thursday Goodies -- Death by Laughter

I remember watching the British comedy show "The Goodies" when I was much younger. It was a very strange show. And apparently, it has both killed a viewer and caused an early birth.

From Wikipedia: 

On 24 March 1975 Alex Mitchell, a 50-year-old bricklayer from King's Lynn, literally died laughing while watching an episode of The Goodies. According to his wife, who was a witness, Mitchell was unable to stop laughing whilst watching a sketch in the episode "Kung Fu Kapers" in which Tim Brooke-Taylor, dressed as a kilted Scotsman, used a set of bagpipes to defend himself from a black pudding-wielding Bill Oddie (master of the ancient Lancastrian martial art "Ecky-Thump") in a demonstration of the Scottish martial art of "Hoots-Toot-ochaye." After twenty-five minutes of continuous laughter Mitchell finally slumped on the settee and died from heart failure. His widow later sent the Goodies a letter thanking them for making Mitchell's final moments so pleasant.

On 1 November 1977 Seema Bakewell, a 32-year-old housewife from Leicester, went into labour whilst laughing at a sketch in The Goodies episode "Alternative Roots". She refused to leave home for the hospital until the episode had finished.

Trump Keeps Talking the Dollar Downward

Recently we saw the U.S. dollar slide after President Trump said "our dollar is getting too strong." But that's not the first time he's talked the greenback lower.

Source

So, do you think Trump will change his mind and start talking the dollar up? Or does it suit his economic goals to have the dollar move lower against the currencies of China, Japan and Europe?

I think he wants a cheaper dollar. And that should be bullish for gold.

Just something to think about.


P.S. I’m putting the finishing touch on a virtual goldmine of my favorite microcap stocks in the metals and mining space. And I’m planning to unveil these to our very best subscribers in the coming weeks. If you’d like us to notify you about not only what to buy … but also precisely when … just let me know by clicking this link here.

How I'm Playing Gold and Miners Right Now

In other news, even though the dollar is weaker, gold is down today. It must be technicians selling as gold bumps up against the big downtrend I told you about.

The good news for gold is all the bearishness we're seeing now. Story after story about how gold must surrender its gains. I'm expecting whipsaw volatility as first the bulls, then the bears, then the bulls, then the bears get disappointed again.

But the fact is, fundamentals are seriously in gold's favor. I think we're going to break that downtrend. It just may take some time. Personally, I took some gains in PureFunds ISE Junior Silver ETF ($SILJ) yesterday. But I'm holding on to plenty of other positions. I don't want to be THAT GUY who sells everything at the first sign of trouble, then ends up crying in his beer.

And I may buy SILJ again soon. Or I may end up kicking myself because I miss the next entry.

But there is plenty of else that looks good. And the more pressure there is on good miners, the more of a banquet of bargains is laid before us.

P.S. I’m putting the finishing touch on a virtual goldmine of my favorite microcap stocks in the metals and mining space. And I’m planning to unveil these to our very best subscribers in the coming weeks. If you’d like us to notify you about not only what to buy … but also precisely when … just let me know by clicking this link here.

JP Morgan's Sector Earnings Outlook

Quite a button-popper for energy, if JP Morgan's outlook holds true.

Accoring to JP Morgan, 2017 looking shiniest for energy, financials and technology. Then again, forecasts often get wrecked by the rocky reefs of reality. I'm not trying to be a downer. Just: We'll see.

Original story HERE

This Gold Party Ain’t Started Yet

By Sean Brodrick

(Story originally posted HERE)

You know who hates this market right now? Every investor who hasn’t bought gold and miners, thinking the rally this year is just a flash in the pan. I see "sour grapes" stories in the mainstream media all the time, talking about how gold is doomed. Doomed! DOO-OOMED!

Ha! I welcome their hatred of this rally. Their bitterness. They’ll change their minds eventually. And you know what? Plenty of ’em, when they finally go long, will STILL make money.

That’s because this gold rally hasn’t even really started yet. Let me show you a long-term chart of gold.

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This chart shows the last big bull market in gold, and the subsequent 5-year-long bear market, and the new bull market.

Wait! No! It doesn’t show a new bull market at all. Even though I’m certain gold entered a new bull market at the beginning of 2016, chart-wise, that rally isn’t enough to break the big bearish trend that has been in place for six long years!

That’s right. The downtrend started before the official bear market began. Gold has trended lower for six years!

So could the bears be right? Could gold’s doom be nigh?

Well, sure. If every darned fundamental that I’ve been hammering about didn’t exist. Peak gold. Rising inflation. The ballooning Asian middle class. The cyclical nature of gold. And more!

But those bullish forces DO exist. The tide in gold has turned. And we are getting closer to a big breakout.

And let me tell you this: Every investor who is long gold and miners should stand up and give President Trump a standing ovation. He’s the force behind the recent gold rally.

First he bombed Syria. Then he threatened North Korea. Then he dropped all talk of China being a "currency manipulator." Then the Prez told the Wall Street Journal that the U.S. dollar is "too strong."

Result: The U.S. dollar looked back over its shoulder wistfully, then did a nose-dive off the roof. And as the greenback tumbled lower, gold jumped higher. That’s the "seesaw of pain" I keep telling you about.

Sure, I expect that what Trump giveth, he can taketh away. If and when things smooth over with North Korea, we’ll see a pullback in gold. Likewise, he talked the dollar down one week, so he can talk it up the next.

And there is still plenty of bearish sentiment lately. That’s why many miners have been laggards. Investors do not believe it. Heck, mining companies don’t believe it. French investment and bullion bank Natixis tells BullionVault that producers are selling gold into the current surge.

Why? I’ll tell you why! Because a five-year bear market has crushed their hopes. They see a six-year downtrend looming dead ahead, and they are panicking.

But downtrends are made to be broken. Oh boy, are they.

The fact is, gold is making higher highs and higher lows. We HAVE hit peak gold production. Gold is so cyclical it should be in the Tour de France. And those cycles are gearing up. Way up.

Let me show you one more chart before I go. Showing that you haven’t missed the boat. It’s a chart of gold’s daily price action through Thursday.

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Sure, gold bulled through overhead resistance at $1,260. That resistance is now support. But there is even bigger resistance at $1,309.

Now, we might get there quickly. Recently, I told you just how quickly gold can fill an overhead gap in volume.

But gold might also zig-zag. The market causes the maximum amount of pain to the maximum number of investors — you know that. We could even see gold zag downward to test its recent uptrend before it really breaks you.

You know, in your gut, that such a dip would be a heck of a buying opportunity. But too many will listen to the sour grapes of Wall Street. It’s very hard to buy that kind of dip.

But if such a dip happens, those who do buy it could position themselves very nicely for gold’s next big bull move.

And when that happens, I have a select group of smaller gold and silver stocks. They’re overlooked by Wall Street. And they should shine very brightly indeed.

And that big rally is coming. Sour grapes be damned.

Best,
Sean

P.S. I’m putting the finishing touch on a virtual goldmine of my favorite microcap stocks in the metals and mining space. And I’m planning to unveil these to our very best subscribers in the coming weeks. If you’d like us to notify you about not only what to buy … but also precisely when … just let me know by clicking this link here.

If you want to comment, feel free to post at the bottom of the original story on Uncommon Wisdom Daily.

The Latest from me on Gold. GOLD! GO-O-O-O-O-O-OLD!

I've been super-busy with the launch of my new publication. It rolls out in a little over a week. And I'm also writing columns for Uncommon Wisdom Daily nearly every day.

So, I have very little time for this blog.

Here's where you can always find my latest:
Uncommon Wisdom Stories by Sean Brodrick

And here is a sample of my recent stories ...

India's Gold Demand Surges

Gold ETFs Back Up the Truck

Gold is Knock-Knock-Knockin' on Heaven's Door

By the way, I’ll be speaking at the Metals Investor Forum in Vancouver, Canada, on May 5 and 6. It’s a private meeting of the best brains in Canadian metals and mining. And you’re invited.

If you believe, as I do, that the small-cap miners and explorers are on the launch pad, you won’t want to miss this. Please join me, if you can. You can find more information at: https://mifmay2017.eventbrite.com/?aff=brodrick

And since this is Hella Thursday -- the Day Before Good Friday -- let me leave you with a song. I know most people prefer the Guns 'n Roses version. But I am an old fart. 

What to do Before the Next Heart Attack

This story was originally posted on Uncommon Wisdom Daily on March 31, 2017. 

The market has been cruising along for so long that many investors forget bad things can happen. Boy, they can happen. And before they do, you need to buy ONE THING.

See, the market is like a big, beefy guy out mowing his lawn on a weekend morning. He carries a lot of weight, but he needs that weight to throw around. He always gets his way.

And the lawn. Well, the wife has been crabbing at him to mow that lawn all week. He has to get it out of the way before the games start in the afternoon, right? So he is striding across that lawn, chopped grass flying around like money confetti, and nothing is going to stop him.

Until something does.

It starts as a twitch in his arm. Then a pain spreads down his arm into his chest. Damn, must have pulled something, right? Probably tugging on that lawnmower too much in the turns.

So the big guy slows down. But the pain doesn’t. It gets stronger. And then there’s tightness all across his chest, and up into his jaw. For Pete’s sake, what’s that about? Then he realizes his breath is coming short and fast. He can’t seem to fill his lungs to save his life.

And by the time he falls to his knees, he can only pray his wife sees what’s going on and calls the paramedics before it’s too late.

That’s just what happened, metaphorically speaking, to the stock market in 2000. Stocks dropped by 50%.

It happened again in 2007-’09. It was worse that time, like all second heart attacks are. That time, the S&P dropped by 57%.

Guess what went up both times? I’ll give you a golden minute to think about it. Then look at this chart of the action in the S&P 500 from 2000 to 2002.

The bad news started in August. I remember that, by February, you could see the signs of worry on faces all over Wall Street.

Except the gold traders. In February, they started to smile. And that smile spread wider for gold … even as the S&P 500 went down for the count.

I could show you a chart of 2007, but you get the picture.

Fast-forward to today. Let’s talk about the weight the market is carrying around. That big lug, he’s only piled on more pounds.

You want to talk debt? The national debt was recently $165,542 per taxpayer. My, that is on the portly side.
You want to talk household net worth to GDP? That’s a metric that the boys at Sprott are using in a new commentary. Analyst Trey Reik says this measure is WA-A-AY out of whack. And if it adjusts down to a reasonable level, Trey writes, it implies:

"A decline of between $36 trillion and $46 trillion in the aggregate value of the three major U.S. asset classes (stocks, bonds and real estate)."

Wait … $46 trillion? Now we’re talking real money.

But hey, let’s keep it simple. Let’s talk good ol’ fashioned P/E multiples. The S&P 500 is at 24.5. That’s a lot, especially considering lackluster earnings growth and an economy stuck in second gear.

Yeah, the P/E ratio has been higher before. During the financial crisis, and twice during the dot-com boom and bust.

Do you remember what happened to markets during those times?

I sure do. I still have the scars.

But gold, now, gold is a safe haven when the market has a heart attack. Or gets run over by a lawnmower. Use whatever metaphor you want. But you know that there will be another crisis.

When the market clutches its chest and keels over, you’ll want a layer of gold to armor your wealth. Buy it now while it’s cheap.

You know that heart attack is coming. Be ready.

All the best,
Sean Brodrick

P.S. Record-high margin debt is just another example of the market carrying too much "weight." Here’s what that may mean for stocks 

If you liked or hated this article, please comment on the original post at https://www.uncommonwisdomdaily.com/next-heart-attack-24114

Silver Miners' Dirty Little Secret

This article was originally Posted on March 30, 2017 at UncommonWisdomDaily.com/.

by Sean Brodrick

I like silver miners a lot. I strongly believe they could lead the next leg of the precious metals bull market. I laid out a bunch of reasons why on Tuesday, in "Silver is Poised to Take the Gold."

However, there is a dirty little secret in mining: Not all silver mines are really silver miners.

By that, I mean some produce more gold than silver. Some also get large amounts of revenue from copper, lead and other metals.

Now, that’s not necessarily a bad thing. But if you’re buying a "silver" miner, be aware of just how much of its production mix is actually that metal … and not something else.

Here’s a chart of five popular silver miners. It breaks down the company’s revenue contributions by metal.

There are two obvious leaders …

First Majestic Silver (AG) derives the highest percentage of its revenue from silver. Last year, about 70% of its revenue came from silver sales.

I’ve visited First Majestic projects multiple times. Those guys are sharpies. They have given their company the motto: "One metal, one country." That’s because they own six producing primary silver mines, all in Mexico.

Pan American Silver (PAAS) is the other leader. It gets about 51% of its revenue from silver. Pan American is also the second-largest primary silver producer in the world.

It has seven operating silver mines in Mexico, Peru, Bolivia and Argentina. Three of those mines produce more revenue from gold than silver. But the silver production at its other mines manage to make silver the biggest part of its revenue mix.

There’s also an honorable mention …

Silver Wheaton (SLW) isn’t on the chart, but it’s the No. 1 (whoo-hoo!) silver producer. The reason it’s not on the chart is Silver Wheaton isn’t a miner. It’s a streamer. That is, Silver Wheaton buys "streams," or production, from other mines. Lots of ’em. And that gigantic silver streamer is hard to beat.

Then there are the others in the chart …

•    Tahoe Resources (TAHO) gets only 40% of its revenue from silver.
•   Hecla (HL) gets 39% of its revenue from silver.
•   And Coeur Mining (CDE) made only 37% of its revenue from silver in 2016.
• But wait a minute! Isn’t Tahoe known for the richness of its Escobal silver mine in Guatemala? Yes, it is.

But it bought Lake Shore Gold, which was one of my favorite small gold producers before Tahoe acquired it. And then Tahoe acquired Rio Alto and its Shahuindo project, an open-pit heap leach gold mine.

That’s a lotta gold.

What’s in a Name?

Wait one more minute! I’m leaving a big silver producer off this list — Silver Standard Resources (SSRI). I mean, it has "Silver" in the name, right? It must be a primary silver producer. Right?

Nope. Only 33.9% of Silver Standard’s revenue comes from silver. It has three big mines, and two of them are primary gold producers.

So that’s the dirty little secret of some of the world’s top silver miners. They’re actually gold miners that also produce silver.

So why are silver miners buying and developing gold mines? It’s not just to make a buck. The fact is, new, good silver mines are as rare as hens’ teeth.

And in those that do exist, the grade of the ore mined is going lower. Here’s a chart of the average grade at the world’s top seven silver-producing companies, through 2015.

You can see that grades are going down. Not surprisingly, production at the big seven is also going down.

And that brings me to one last chart …

Yep, the world hit Peak Silver. In other words, production of silver from the world’s mines has peaked. That’s according to GFMS Thompson Reuters.

Silver production fell about 3% last year. And it should keep going down. It takes years — often more than a decade — to bring a new mine online.

So that’s why I’m bullish on silver, and silver miners.

And if you’re thinking there are some good little primary silver producers I haven’t mentioned in this article, you’re right. I’ll tell you about them later. When I roll out my new publication for Uncommon Wisdom Daily.

For now, you can do your own due diligence and buy individual miners. Or just buy the Global X Silver Miners ETF (SIL). It’s a basket of rock-solid companies.

Just be aware that many of the miners held in the SIL get more of their revenue from gold than silver. That limits their stock prices’ leverage to silver prices.

And that shows just how tough it is, when a silver-biased ETF ends up owning a lot of gold miners.

All the best,
Sean Brodrick

Silver is Poised to Take the Gold!

Silver has its racing shoes on, and it is pulling away from the pack. Take a look at the year-to-date performance of silver, gold and the S&P 500.

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The S&P 500 is up 5.77%, riding a wave of Trump-mentum. Gold is doing better, with an 8.47% gain. But silver is sprinting, with a 13.5% gain.

If silver keeps up this pace, that would work out to a 65% gain for the year.

Now, there’s nothing to say silver must keep up that pace. It could slow down. Then again, it could speed up. We’re in a new precious metals bull market, after all.

Importantly, silver is at a critical point. Let me show you another chart of silver, as tracked by the iShares Silver Trust (SLV).

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You can see that silver gapped higher on Monday, jumping right to its 200-day moving average. Now, it is testing its big downtrend from August.

Silver made that gap higher on strong volume. That’s bullish, too.

It’s likely that one of two things will happen here:

•    The less-likely thing is that silver will plow through that overhead resistance like a rampaging bull. I say less likely, but the metals have surprised us for months.
•   The OTHER thing that could happen is silver could pull back to test its uptrend, which I’ve marked as a blue dotted line. If silver does that, I’ll be happiest.

Why? Because more coiling up means the eventual explosion higher will only be bigger. A pullback will also be an opportunity to pile into miners with exposure to silver.

Fundamentally, what’s powering this move?

Silver is Rare. Pure-play silver mines are precious indeed. Most silver comes as a byproduct of other metals. That means silver production can’t be cranked up to meet rising demand.

Peak Silver. In fact, production from silver mines peaked in 2015, according to GFMS Thompson Reuters. And it should keep going down. We’ve hit "Peak Silver."

Solar Surge. Silver is an industrial metal as well as a precious metal. Industrial fabrication makes up about 50% of silver demand each year, vs. less than 10% for gold demand.

Silver is used for all sorts of things, from wiring in cell phones to chemical reagents to the paste used in solar cells.

Many industry analysts thought solar demand for silver was peaking. That turns out not to be the case.

Prices of solar modules are falling as the industry becomes more efficient. That is stoking demand, especially outside the U.S. And that’s pointing the way to more silver consumption.

Weaker Dollar. Just like gold, silver straddles the "Seesaw of Pain" with the greenback. When one goes up, the other usually goes down. Now, the dollar appears to have peaked. And that opens the door to higher silver prices.

I hope we get that pullback in silver. It would be a buying opportunity. Silver is ready to run — the starter pistol is cocked. The race is beginning, and silver could take the gold.

Investors should get out of the way, or ride this rally for all it’s worth.

This story was originally posted on Uncommon Wisdom Daily on 3/28/2017

I Can Pick 'Em! Exeter Acquired for $250 Million

On March 6, while I was at the PDAC in Toronto, I ran my video interview with Exeter Resources' CEO, Wendell Zerb.

http://king1eye.blogspot.com/2017/03/a-waking-giant-one-of-largest.html

If you click through, I also explained in detail why Exeter was sitting on the next big gold mine. And I also had a chart of stock action, showing Exeter was outperforming its peers.

Now, Goldcorp just bought Exeter for $250 million. That's 2.5 times its market cap.

In retrospect, the fact that Exeter insiders were buying the stock hand over fist was kind of a clue.

More details on what Goldcorp is up to HERE.

This isn't the end of the story. It's just the beginning. There are many more acquisitions to be made in this gold bull market.

Sean

Buy This Copper Crunch

Investors are getting a case of the jitters watching copper’s recent trading action. Since mid-February, copper has been in a big correction. And it’s handing you an opportunity.

This pullback has implications for all kinds of markets beyond metals. Investors call this metal "Doctor Copper," because it has a Ph.D. in economics. When copper prices go higher, the global economy heats up. When copper prices go lower … well, you can see why people get worried.

Don’t worry. Be happy. And buy this danged pullback.

Let me show you the Big Picture in copper …

Longer term, copper broke out of a multi-year downtrend. So, some pullback is to be expected. And it’s a buying opportunity for copper and the companies that produce it.

Let me give you three copper-plated bulls for this year.

Lack of Big, Rich Deposits. Copper mines must be big to make any economic sense. They require a LOT of investment. Too bad that most of the big deposits have already been found. In fact, only six big new projects to build mines or expand existing operations will be completed by 2020.

Tightening the squeeze, the grade of copper ore coming out of the ground is half what it was in 2008. That means miners get half as much copper with every ton of dirt.

And the long bear market didn’t help. That forced copper companies to mine their richest grades. Now, that ore is gone — used up.

Watch China. Asia, especially China, accounts for 62% of the world’s copper usage. Sorry, Uncle Sam, but you use only 14%.

So, it’s bullish that imports of copper into China rose 1.9% in the first two months of 2017, to 2.7 million metric tons. In fact, Chinese copper demand looks poised to rise all year.

China is mainly used for copper wire. And a lot of that goes into infrastructure. China plans to spend $720 billion on infrastructure projects over the next three years.

Labor Troubles Squeeze Supply. So far in 2017, we have seen production stoppages at major mines like and BHP Billiton’s (BHP) Escondida mine and Freeport-McMoRan’s (FCX) Grasberg mine. Escondida alone produces 5% of the world’s copper.

Just in Chile alone, a whole gallery of copper companies face tough labor negotiations: Antofgasta with its Zaldivar Mine, Glencore with its Altonorte Mine, Anglo American and Glencore (again!) with their Collahuasi joint project, Teck Resources in its Quebrada Blanca Mine, and Lundin at its Candelaria Mine. And that means more production could be lost to strikes.



We’ve already seen 200,000 metric tons of copper production lost to strikes so far this year. Annualized, that would be 10% of global production.

Prices are made on the margin. So this all points to prices getting squeezed higher.

So why have copper prices — and miners — been under pressure lately?

Some investors fear that Donald Trump won’t be able to follow through on his plans to rebuild America’s infrastructure. A plan that requires a lot of copper.

But as I’ve shown you, the U.S. is a small piece of the global copper demand picture. China is much more important.

I think we should see a rally coming in the iPath Bloomberg Copper ETN (NYSE: JJC), which tracks copper prices.

The JJC has been in correction along with miners. But if supply gets crunched the way I think it will, this fund could follow copper prices much higher.

This story was originally posted on Uncommon Wisdom Daily 

Dollar-Yen Is Losing Its Zen

Happy Friday.

My wife and I just saw the musical "Something Rotten" last night. Highly recommended. It's the best musical comedy I've seen in years, perhaps ever. This Wikipedia page contains some inaccuracies, but gets the gist of it.

Anyway, let's talk about an opportunity that is right in front of us.

As Reuters reports: "The dollar edged up against the yen on Friday, recovering from its worst run of daily losses versus the safe-haven currency since 2010, but gains were capped by worries that U.S. President Donald Trump was on course for defeat on a new healthcare bill."

Here's a chart of the Dollar-Yen. I've added gold for shitzngiggles, as well as a trend indicator on the bottom.

As you can see, the trend in the dollar-yen is bad. It mirrors what is going on in gold. In other words, the dollar's decline is boosting gold.

Now, the dollar is going to try and bounce. It could for a few days. This could add to the pullback in gold, which I talked about in yesterday's Uncommon Wisdom Daily afternoon edition.

You can read the rest of my Thursday analysis on gold by pointing your browser HERE. Read Brad's fine column on healthcare, then scroll down to see my "Mining for Metals" column.

Now, let's get back to the first chart, the chart of the US Dollar-Yen. Look at the ADX trend indicator. It has turned bearish for the dollar-yen. It's true this is a rear view mirror. But the bearish trend really started on the 15th.

And it has plenty of room to get more bearish. There is no guarantee that will happen. But more investor disappointment in Washington could certainly deepen that trend.

So a short-term bounce in the dollar might be a short-term buying opportunity in gold and miners.

Just something to think about on this happy, yappy Friday. 

Oil Says: Big Drop Ahead!

This post appeared yesterday at UncommonWisdomDaily.com. To get the news first, be sure to subscribe to our free ezine.

By Sean Brodrick

Most investors hope this market correction ends sooner rather than later. I hope that, too.

Now brace yourself for some bad news: Oil price action is telling us not to get our hopes up. Not at all.

You’ll remember on March 17, I posted a chart of the Dow Transports. That index was screaming a warning cry that all was not right with the market.

Then, on Tuesday, the Transports’ warning came true as the major indices went into "Sell! Sell! Sell" mode. Pretty much everything but utilities and gold miners fell out of bed. Hard.

You can see an updated chart of the Transports’ dire warning HERE. It still looks terrible. The bearish trend is getting stronger.

Now, the price of West Texas Intermediate Crude is chiming in. And many investors will wish the Texans kept their big yaps shut!

WTI crude is the American oil benchmark. It’s what markets use to track U.S. oil prices.

Thanks to some wheeling and dealing by the Saudis, OPEC and other foreign producers managed to put a lid on production and a floor under oil prices early last year. That agreement was reinforced at the end of 2016.

But U.S. shale oil producers aren’t part of that agreement. And recently, rising U.S. production caused oil prices to fall off a cliff.

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You’ll see I’ve indicated what may be a "bear flag" on the chart. We won’t know until it resolves. But there’s a saying on Wall Street: "Flags fly at half-mast." In other words, the downward move in oil may only be half-done.

Mind you, outside events can flip the whole picture for oil overnight. It’s a very volatile commodity.

So how does oil relate to the S&P 500? Well, it turns out that corrections in oil often proceed corrections in the broader market.

Take a gander …

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On top, I track the performance of oil. On the bottom is the performance of the S&P 500.

Sure enough, big moves up or down in oil are often followed by the big stock index. That’s not too surprising. Energy stocks are a big part of the S&P 500.

Now look how oil just broke its uptrend. Will the S&P 500 do the same? That would be a heck of a move. About 10% lower!

Sure, charts are an art — not a science. Just because a chart gives a warning doesn’t mean it must come true. If that were so, all chartists would be billionaires.

But there’s enough of a coinkydink that investors might want to pay heed to oil. And pray that crude finds its footing sooner rather than later.

Because otherwise oil is warning: "Look out below!"

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Getting Religion on Gold

Lawyer Clarence Darrow was famously a religious skeptic. Someone asked him: "Suppose you die and go to heaven. And it turns out the conventional story is true?" Darrow replied that he would walk up to the divine judges’ bench, bow low and say: "Gentlemen, I was wrong."

Now it’s time for my true confession. I may have been wrong. On March 16, I laid out my case for gold being in a big bull market in my article, "Your Golden Opportunity."

I was bullish, sure. I said gold made a major bottom in January 2016. And the correction since July was just that — a correction to the new bullish trend.

However, I also said we probably hadn’t seen the bottom of the correction … yet.

Gentlemen, I may have been wrong.

Gold may not wait for March to end.

Here’s what I was thinking: March is usually a terrible month for gold. Look at a monthly chart of the metal. March usually sees gold stumble.

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Those blue dotted lines show the month of March. Down, down, down. Even after the new bull market started in 2016, March was Debbie Downer.

Longer term, this still holds true. Since it became legal to own gold again in 1975, gold has AVERAGED a loss of 1.04% in March. That’s worse than any other month. Yeesh!

So you can see why I was hesitant to call the correction over ...

Read the rest of this article at UncommonWisdomDaily.com

Bears Raise a Flag for Oil

Here's a chart of the U.S. oil benchmark


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I made this for a bigger story I wrote for Uncommon Wisdom today. It's about the relationship between oil prices and the S&P 500. I'm saving the best chart for Uncommon Wisdom subscribers. 

So to see that chart, make sure you subscribe to our FREE newsletter.

My Interview with Amir Adnani of UEC on 03-07-2017

While at the PDAC in Toronto, I had a chance to sit down and catch up with Amir Adnani. Naturally, he's bullish on his company Uranium Energy Corp (NYSEMkt: UEC). He also gives his reasons why he thinks 2017 is uranium's year to blast off again.





I posted this video and a longer story to Uncommon Wisdom Daily. You can read that story HERE. 



And remember, to get the scoop first, subscribe to Uncommon Wisdom Daily.

Chart of the Week Glows in the Dark

This column originally ran on Uncommon Wisdom Daily on March 17, 2017.

Gosh, not very long ago, it sure seemed like the uranium market was dead. 2016 saw uranium prices crumble to 12-year lows. Today, prices are off that bottom, but only a little.

It’s so danged bad that Kazakhstan, source of 30% of the world’s uranium supply, is cutting its own production by 10%.

Nobody undercuts the Kazakhs on price, so that’s the equivalent of a B-movie atomic-powered monster doing a face-plant. Game over, man!

Meanwhile, the guys who run uranium mining companies have been promising me that prices would rally — any week now — for three years. THREE. LONG. YEARS.

Yeah, you could say I’m a bit disgusted with the uranium industry.

Well, lo and behold. That atomic-powered monster is rising from the rubble and coming back for a sequel. Take a look at a chart of the Global X Uranium ETF (URA).

This chart shows that URA rallied big since November. In February, it started pulling back. That consolidation brought it back to nearly a 50% retracement of the big move.

If you read JR Crooks’ fine stuff, you know that 50% is a common Fibonacci retracement. It’s often tested before a stock or fund takes off again.

Now, URA has clawed its way back above its 50-day simple moving average. This can be seen as a dividing line between bullish and bearish movements.

Finally, on the bottom of the chart, I’m using a momentum indicator called the "Force Index." It’s one of my favorites.

Here’s why: Just like in Star Wars, you want someone who is strong in the Force. URA’s Force Index just switched from bearish to bullish — from the Dark Side to the Light Side, if you will. Momentum is with the bulls on this one.

So what is the URA ETF anyway? This is a basket of leading uranium producers and explorers, including Cameco Corp. (CCJ), NexGen Energy (NXE), Uranium Energy Corp (UEC) and 23 more. The URA even has the Uranium Participation Corp. (U) which holds physical uranium hexafluoride gas, among its components.

That’s a glow-in-the-dark lineup.

Now, you could buy one of those individual miners. Heck, I do it. But the beauty of the URA is you get plenty of upside without single-stock risk.

What am I talking about? Well, do you want to see a picture of a heart attack on the trading floor? Let me introduce you to Cameco, North America’s biggest uranium producer …

You can see that in January, Cameco suffered a one-day, 18.5% drop. It recovered most of that. But then it careened into a 19.5% drop. Again it recovered. Then it went into a "Slope of Nope."

By that, I mean, "You gonna buy a stock sloping like that?"

"Nope."

Now, this is not Cameco’s fault. Some events are beyond its control. Japan suddenly decided it was going to break long-term uranium supply contracts. Ding-dangity dang it!

But at this point, if you’re trading Cameco, the odds are better than average that you’re a masochist.

Cameco is a well-run company, and I’m sure it will be a good buy once it looks like it will put its troubles behind it.

Now go back to that chart of URA. Sure, it had a bumpy start to 2017. The whole industry was riding like an old Ford with bad shocks. But URA’s ride was much smoother than the coronary special that Cameco went through. And all the extra it charges is a 0.7% annual expense fee.

Do the fundamentals in uranium support the price action in URA? No. Not yet. But as often is the case, stocks can lead the news.

Next week, I’ll show you an interview I filmed at the world’s top mining conference with the CEO of a uranium company. He talks about the industry generally. He strongly believes prices are about to ramp up.

That’s what we may be seeing priced into URA right now.

Sure, I’m disappointed with how uranium has acted these last three years. But you can’t let emotion get in the way of trades. And now, it sure looks like that Atomic Monster is rearing its ugly head.

Pass the popcorn. This could be fun.

All the best,

Sean

See the original article at Uncommon Wisdom Daily