Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24
How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - 17th Feb 24
Why Rising Shipping Costs Won't Cause Inflation - 17th Feb 24
Intensive 6 Week Stock Market Elliott Wave Training Course - 17th Feb 24
INFLATION and the Stock Market Trend - 17th Feb 24
GameStop (GME): 88% Shellacking Yet No Lesson Learned - 17th Feb 24
Nick Millican Explains Real Estate Investment in a Changing World - 17th Feb 24
US Stock Market Addicted to Deficit Spending - 7th Feb 24
Stocks Bull Market Commands It All For Now - 7th Feb 24
Financial Markets Narrative Nonsense - 7th Feb 24
Gold Price Long-Term Outlook Could Not Look Better - 7th Feb 24
Stock Market QE4EVER - 7th Feb 24
Learn How to Accumulate and Distribute (Trim) Stock Positions to Maximise Profits - Investing 101 - 5th Feb 24
US Exponential Budget Deficit - 5th Feb 24
Gold Tipping Points That Investors Shouldn’t Miss - 5th Feb 24
Banking Crisis Quietly Brewing - 5th Feb 24
Stock Market Major Market lows by Calendar Month - 4th Feb 24
Gold Price’s Rally is Normal, but Is It Really Bullish? - 4th Feb 24
More Problems in US Regional Banking System: Where There's Fire There's Smoke - 4th Feb 24
New Hints of US Election Year Market Interventions & Turmoil - 4th Feb 24
Watch Consumer Spending to Know When the Fed Will Cut Interest Rates - 4th Feb 24
STOCK MARKET DISCOUNTING EVENTS BIG PICTURE - 31st Jan 24
Blue Skies Ahead As Stock Market Is Expected To Continue Much Higher - 31st Jan 24
What the Stock Market "Fear Index" VIX May Be Signaling - 31st Jan 24
Stock Market Trend Forecast Review - 31st Jan 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

This Chart Shows When Gold Stocks Will Explode

Commodities / Gold and Silver Stocks 2021 Jun 03, 2021 - 10:44 AM GMT

By: Jordan_Roy_Byrne

Commodities

The rebounds in Gold and Silver exceeded my expectations and closed May in a strong fashion, near the highs of the month.

Gold’s monthly close was the third-highest ever. Silver failed to break resistance at $28.50, but its monthly close at $28 was the second-highest in the last eight years.

As noted last week, Gold and gold stocks have perked up in real terms. 


Gold relative to Bonds has broken out to a seven-year high. It has decoupled from Bonds. Also, both Gold and gold stocks have perked up against the stock market.

To understand immediate trends in precious metals, one must follow the various ratio charts. They can help us understand capital flows and anticipate the future.

Multiple ratio charts currently show potential for huge moves in Gold and gold stocks. 

The answer to the title is the following chart.

We show GDX against Gold and GDXJ against Gold.

GDX against Gold could be as soon as several months away from a major breakout, and that would be followed by GDXJ breaking out against Gold.

GDX & GDXJ vs. Gold Ratios

In other words, gold stocks are setting up for dramatic outperformance against Gold over the next year or two.

Oh, and the outlook for Gold is not bad either.

It’s only correcting and consolidating in the form of a larger, super-bullish cup and handle pattern.

Gold Weekly Bar Chart

The corrective low in gold stocks is definitely in as GDX and GDXJ successfully retested the multi-year breakouts they made last year.

After a successful retest of a significant breakout, a market typically trends higher in a steady and sustained fashion. 

An early signal of the relative strength in gold stocks will be GDX breaking out relative to Gold, which may occur before Gold makes a new all-time high. In other words, gold stocks could make new highs before Gold. 

Over the next year or two, we will witness something we haven’t seen in over 15 years.

Most market participants avoid gold stocks because of the crash of 2008 and devastating “forever” bear market and because of their consistent underperformance against Gold. As a result, generalist investors have preferred to own Gold instead of the miners. 

This is an important shift, and it’s only in the first inning.

I’ve positioned myself in companies with the best combination of upside potential and fundamental quality. These are companies you can buy and hold for a few years that have the potential to be 5,7, and 10 baggers after Gold breaks past $2,100/oz.

In our premium service, we continue to identify and accumulate those quality juniors with considerable upside potential over the next 24 months.

To learn the stocks we own and intend to buy during the next correction that have 3x to 5x potential, consider learning more about our premium service.

Good Luck!

Email: Jordan@TheDailyGold.com
Service Link: http://thedailygold.com/premium

Bio: Jordan Roy-Byrne, CMT  is a Chartered Market Technician, a member of the Market Technicians Association and from 2010-2014 an official contributor to the CME Group, the largest futures exchange in the world. He is the publisher and editor of TheDailyGold Premium, a publication which emphaszies market timing and stock selection for the sophisticated investor.  Jordan's work has been featured in CNBC, Barrons, Financial Times Alphaville, and his editorials are regularly published in 321gold, Gold-Eagle, FinancialSense, GoldSeek, Kitco and Yahoo Finance. He is quoted regularly in Barrons. Jordan was a speaker at PDAC 2012, the largest mining conference in the world.

Jordan Roy-Byrne Archive

© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in