Precious metal miners: fathoming the abyss

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Sat, Feb 4, 2017 - 5:30pm Gwyde
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Round numbers

We have something with round numbers. Obviously DOW 20K is back, but so is $1200 gold and $1000 platinum, though much less touted. Over the week, gold strengthened 2.37% to $1219.5 while silver added 2.16% to $17.49. The PGM's lag with platinum up 1.93% to $1001 while palladium is up a tiny 0.95% to $747 after a counter-trend Friday slide. The HUI adds 4.57% over the week, closing at 212.1. HUI/Gold is advancing little to 0.174. You find fresh graphs on the gold miner pulse blog page.

Decent weekly gains among the benchmark ETF's: from 4.87% for SIL to 6.48% for GDXJ. Our Contributor driven explorer & Junior Miner List sits in the caboose gaining only 3.46% last week. We do have 16 picks advancing, but profit taking on Ivanhoe Mining (our top performer) is limiting the advance. Over the long haul we now have 10 picks up against 9 down. After a double digit rally, Integra Gold joins the long term winners.

Gwyde
Mon, Feb 6, 2017 - 5:40pm Gwyde
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Pretium Resources

Pretium Resources (PVG), led by Bob Quartermain, is developing the BruceJack mine in Canada BC. Mine construction is advancing ahead of schedule and a more accurate total cost estimate was released.

https://finance.yahoo.com/news/pretium-resources-inc-brucejack-commissio...

Today the stock adds 13.2% as commissioning may be as early as April.

PVG has been on our Contributor driven explorer & Junior Miner List since March 1, 2013

Gwyde
Sun, Feb 12, 2017 - 11:43am
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About that Springpole project

Mon, Feb 13, 2017 - 3:58am Gwyde
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Decent improvement

On the Contributor driven explorer & Junior Miner List there was a decent improvement last week. We've beaten most benchmarks with only GDXJ rivaling for the top advance. Long term benefits sweeten to over 14%. Much of the outperforming is due to a firm recovery of IVN (Ivanhoe Mining). After a stellar ride, IVN gets overweight in our list.

The list is not a portfolio however: I cannot 'sell half a position' which I may consider appropriate in such case. Taking IVN off the list implies adding it to the successful exits section. Opinions? Alternatives?

Gwyde
Fri, Feb 17, 2017 - 12:49pm
Fri, Feb 17, 2017 - 1:31pm silverwood
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NAK CEO comments

Sat, Feb 18, 2017 - 7:58pm Gwyde
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In opposite direction

American stock markets stay at lofty highs, yet more progress has been made for precious metals. Gold is more or less flat over the week ending at $1234.6 (+0.14%) with silver also ending almost unchanged at $17.95 (+0.11%). PGM's didn't hold on to Thursday's gains and end the week easing fractionally, Pt at $1001 (-0.8%) and Pd at $776 (-0.9%).

PM volatility has not favored miners with the HUI down 1.95% to 214.5, making HUI/Gold ease to 0.173. You find updated graphs on the gold miner pulse blog page. With HUI and gold moving in opposite direction, miner 'overvaluation' relative to the least square regression line is reduced.

Benckmark ETF's give way likewise, easing about 2%; only GOEX trades nearly flat over the week. With a 1.49% decline, our Contributor driven explorer & Junior Miner List is in line with its peers. The long term advance still stands at 12.48%, yet cap weighted that adds up to 35.76%. Only 5 picks were up over the week, while 13 are down with Miranda Gold flat. There still are 10 picks up against 9 down since list inclusion. Asanko Gold has been dissipating its accumulated gains and is nearing break-even. However, Oceanagold was last week's laggard down almost 11%.

Gwyde
Tue, Feb 21, 2017 - 4:37am
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Sorry...

Wrong forum.

(My bad.)

Fri, Feb 24, 2017 - 4:08pm
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Junior Mining Exec Cracks Scratch lottery code

Posted on Main street and wanted to share out of the pay wall:

So, I was doing some business in Vegas this week and Mohan Srivastava was speaking at a conference. “Mo” was working in his office in June 2003 when he discovered a couple of old instant scratch lottery tickets buried under some paper on his desk. The tickets were given to him from a friend. He scratched them and won $3. Excited about winning, he started thinking about how the algorithm behind the tickets worked. After studying the lottery tickets he “cracked the code”, allowing him to determine winners from losers without scratching anything off the face of the cards.

READ the full Wired article

It turns out that Mo Strivastava is a geological consultant for mining companies and an executive VP for junior mining stock Tri Star Gold in Toronto. He’s a super smart guy with degrees from MIT and Stanford. I struck up a conversation with Mo. I don’t get to talk with executive in the mining business, so I was dying to ask some questions. I quickly moved the conversation to manipulation, asking straight up if he thought gold and silver markets were manipulated. He didn’t think so, but I brought up a lot of topics in our short time – the German gold repatriation, the Fed, and the Exchange Stabilization fund. He straight up asked why the gold and silver prices would be manipulated and I explained the need to keep the dollar, the war machine, the whole fiat scam afloat.

We only had about 20 minutes to chat, but he was pretty open to a lot of the talk. We talked about the gold in Fort Knox and he does not think it is there. We talked about market makers and he thinks that their stock is being manipulated by the investment banks. He suspects them of trying to acquire shares at a low price because they know his company needs capital and will be doing an underwriting in the near future.

Here is Tri Star Gold’s PDF presentation. Mo thinks that the company should be worth $1.50 a share based on reserves. It is currently a shade under 30 cents. Not a plug for the stock, do your own diligence. He was very nice and gracious and I wanted to share the story, and cracking the lottery is super interesting!

Fri, Feb 24, 2017 - 4:10pm
KC
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Dup.

Dup

Sat, Feb 25, 2017 - 4:27pm Gwyde
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Miners and precious metals diverging

Dow 20K is behind us as the index is nearing 21K. American stock markets continue their ascent. This doesn't prevent precious metals from firming. Over the past week, gold is up 1.77%, while silver added 2%. Platinum recovered 2.33% after lagging for several weeks, while Palladiium confirms its contrarian stance easing 0.9%. I've been using 24hgold.com for PM prices, since the Kitco.com website has its technical difficulties.

Despite PM metals firming in tandem with the broad stock market, miners have been weaker: the HUI slid 3.8% making HUI/Gold plunge to 0.164, as illustrated by the HUI/Gold graph on the Gold Miner Pulse blog page. Several miners came in with 2016Q4 earnings in line with their own guidance but below market expectations. One may ask whether the latter are realistic considering where PM metal prices were a few months ago. Miners now trade 'gold market neutral', with HUI values almost on the HUI-gold least squares regression line. On the Miners Performance page, last update illustrates the first miner retreat of 2017.

Miner ETFs are weaker across the board, sliding from 2.35% (SIL) to 4% (GOEX). With a 4.2% loss, our Contributor driven Explorer and Junior Mining spreadsheet is lagging.

Over the long haul, the advance shrinks to 7.78%, though cap weighed that amounts to 30.09%. (Note that including exits, we're in the red.) Despite easing only little, Asanko Gold slid below its entry level. We now have left 9 picks advancing against 10 declining. Last week declines outnumber advances 15 to 4 on our list, with 4 double digit declines; especially the 11.9% weekly decline of Ivanhoe Mines (IVN.TO) is hurting. We are overweight in this miner after it has been outperforming.

Gwyde
Sat, Mar 4, 2017 - 3:21pm Gwyde
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Not the first time

While the Dow made it to 21K, precious metals were dumped last week. The rationale stated is that the FED will hike its rate earlier than anticipated. Meanwhile the 10Y treasury rate rose to the highest level of the decade, wreaking havoc among bond investment funds.

It's not the first time that precious metal miners uncoupled from rising gold prices as a trend reversal was imminent. Last week the miner slide wasn't too catastrophic with a leg down on Monday and Thursday interrupted by technical recoveries. The HUI slid 7.15% over the week, considerably more than the 1.76% decline of the yellow metal. HUI/Gold further eased to 0.155 as illustrated by the HUI/Gold graph on the Gold Miner Pulse blog page.

Slides among ETFs were slightly worse than that of the HUI: between 8% for GDX and 11.4% for GDXJ, which doesn't bode well for our Contributor driven Explorer and Junior Mining spreadsheet. Yet we managed to limit the damage to a 6.24% decline, thereby avoiding diving into the red again. Long term we hold on to a timid 1% gain. Among declines the double digit slide of Integra Gold turned long term gains into loss. This brings us to 8 miners/explorers advancing about balancing the loss on 11 others.

Gwyde
Sun, Mar 12, 2017 - 7:21am Gwyde
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Mining investors convinced the gold correction bottom is in

American stock markets reached a ceiling last Tuesday backing off to end the week fractionally lower. Precious metals continued their slide bottoming on Thursday with a modest Friday recovery unable to mend the damage.
Gold ended the week 2.41% lower at $1204.5, while silver shed 5.18% to close at $17.02 on Friday. PGM's also ended beaten up with a 5.52% plunge for Pt to $941 and Pd slid 3.37% to $746. Another 25bp FED rate hike is fully factored in.

Mining investors are convinced the gold correction bottom is in: after Tuesday the HUI ceased leveraging down the gold slide, while the Friday recovery unleashed the bullish sentiment. On balance HUI/Gold is flat over the week - as shown on the gold miner pulse page - despite the yellow metal sliding till Thursday. Miner resilience in anticipation of a gold recovery brought the HUI once more above the HUI-gold least squares regression line. On the Miners Performance page, long term declines again crept into the top quintile.

Among benchmark miner ETF's declines are in line with that of the HUI (2.59%). Only SIL slid 4.8%, which again is less than the 5.2% loss of the white metal. Retreating only 0.57%, our Contributor driven Explorer and Junior Mining spreadsheet is eclipsing its pears. Over the long haul we just manage breaking even (+0.49%). Over the week the 6 advances (led by Osisko) partly offset the 13 declines on the list (with PLG the major drag).

Gwyde
Sat, Mar 18, 2017 - 7:04pm Gwyde
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Speculator mood swings

With American stock markets in the doldrums, precious metals have been where the action was last week. On balance gold adds 2% to $1228.8 but on Tuesday the Gold market plunged to a $1198.6 close. Likewise the 2.06% advance for silver to $17.37 only tells half the story. Volatility was King with a Tuesday plunge to $16.84. As precious metals rallied, regaining losses incurred on Wednesday, the speculator mood swing was enlarged among miners, with the HUI up 7.78% for the day. Overdone, some investors may have thought: miners were plagued with profit taking sliding towards the WE, despite the metals confirming their advance. On balance HUI/Gold firms to 0.159 with the HUI advancing 4.7% over the week. The gold miner pulse page provides an in depth analysis.

Advances of the miner ETF's are in line with that of the HUI. Our Contributor driven Explorer and Junior Mining spreadsheet is lagging with a 3.1% advance. The profit taking on Friday (-1.6%) considerably impaired our weekly advance. The long term gain now stands at 3.55%. Over the week, 16 picks are up, but two slid against the trend: Sandstorm gold and Mirasol declined slightly. The double digit rally of Integra Gold wiped away its long term loss. We again have 9 picks up against 10 down over the long haul.

Gwyde
Sat, Mar 25, 2017 - 7:52pm Gwyde
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Climbing the 'wall of worry'

The gold recovery just may have run its course and the yellow metal is backing of its Wednesday high. The gold/silver ratio is back up to 70, so the white metal rally is even further away, not to mention Platinum which even is down over the week. Moreover the miners have been grinding lower for three consecutive sessions. OK, these are some 'capita selecta' illustrating the 'wall of worry' we need to climb.

The complete picture is that over the week gold still adds 1.15% to $1242.9, silver adds 2.13% to $17.74. Less enthusiasm indeed for platinum, yet off barely $1 to $962; however Pd rallied 4.13% to $807. In the margin, Rhodium (the notorious laggard in the 2016 precious metal rally) is firmly recovering. From its abysmal $585 low last summer (when gold was peaking), the rarest of precious metals now rallies to $910. It thereby even outperforms Palladium.

Even though miners have been grinding lower since Tuesday, the HUI still is up 1.94% since previous Friday, with HUI/gold now at about 0.16. You find fresh graphs on the gold miner pulse page. The Miner Performance Page also got a fresh update. Runner up Osisko Mining -one of the picks in our spreadsheet- now takes the lead from Arizona Mining.

The miner ETF's are a mixed bag, with GDX (+1.1%) lagging the HUI, yet GDXJ and GOEX even threading water; both down fractionally. With a near 3% advance, our contributor driven explorer and junior miner spreadsheet leaves behind its peers. Over the week we have 13 advances against 5 declines, with Eurasian Minerals flat. Ivanhoe Mines (IVN) (+9%) leads the upside, adding to its long term gains. Platinum group Metals slid another 7.8%, deepening its loss. Over the long haul our list is up 6.64%.

Gwyde
Sun, Apr 2, 2017 - 6:08pm Gwyde
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Miners lagging the metals

Stock markets were ebbing and flowing to a higher close over the week. The same counts for gold and silver: where the yellow metal only posts a tiny 0.51% gain over the week, silver added 2.76%. Yet miners have been lagging: the HUI is down 1% over the week, making HUI/Gold ease to 0.1576. You find more on the gold miner pulse page.
As we end the first quarter, a fresh update of the miner performance page also has been added. The number of advances balance that of declines.

Minor retreats for GDX and GDXJ among the mining ETF's. SIL even advances a little, yet still lags the decent silver gain. With a 0.4% decline, our contributor driven explorer and junior miner spreadsheet is amidst the squad. There are 7 advances over the week, unable to balance the decline of the 12 others.

Gwyde
Sun, Apr 9, 2017 - 4:48pm Gwyde
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External shocks

During the past week, external shocks caused short term shifts but not the long term tendency: American stock markets barely are off their all time highs, while gold added 0.37% over the week to $1253.8. The murderous Sarin gas attacks in northern Syria, the bombing of the military airfield as retaliation and the Stockholm terrorist attach caused their temporary level shifts or price spikes. Silver gave back some of last week's gains while the PGM's added a little.

After lagging last week, miners improved: the HUI index added 3.34% over the week, making HUI/Gold firm to 0.1621. You find more on the gold miner pulse page. We have a short trading week ahead leading to Easter, next update will be on April 21.

Mining ETFs can't catch up with the HUI: GDX comes close with a 3.02% advance, but GDXJ (+1.61%) and GOEX (+1.17%) disappoint. However, our contributor driven explorer and junior miner spreadsheet is beating all benchmarks with a 4.37% weekly advance, despite a fractional decline on Friday. The long term gain sweetens to 10.84%. Over the week 13 miners/explorers advanced against 6 declines. Long term advances (9) don't outnumber declines (10) yet.

Gwyde
Sat, Apr 22, 2017 - 3:09pm Gwyde
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Why juniors are lagging gold now

American stock markets recovered from earlier losses ending the week fractionally up. Nasdaq had the best cards, gaining 1.82% over the week. Precious metals lost some of their splendor: gold only gave back 0.3% over the week, ending at $1283.9. Yet silver slid 3.35% to $17.9. The Au:Ag ratio edges up to 71.73, which is a YTD closing high. PGM's end the week little changed: Pt -0.21% and Pd flat, with daily fluctuations cancelling out.

Miners were disappointing: the HUI eased 3.45% over the week, making HUI/Gold slide to 0.1595. You find more on the gold miner pulse page. The HUI residuals compared to the regression line have been negative for several days now, indicating miners lagging gold. The fresh update of the Miner Performance page still shows an advance relative to previous update on March 31st: the deterioration is recent.

Yet that's only part of the story: GDXJ had significant capital inflows over the past few months, leading to quite high percentage stakes in some of the explorers and juniors. As such it has been considered necessary to extend their investment universe, including now also several mid tier producers and some of the less valued majors. Consequently they are forced to sell part of their positions in explorers and juniors in which they are over-invested and purchasing significant stakes in recently included miners. This selling pressure is a blueprint for juniors lagging gold (even more than the majors). Not surprisingly, GDXJ is the worst among our mining ETF's, with a 5.5% slide since Apr 7 (previous update). GDX is best in class, advancing by a modest 0.3%. Other ETF's equally suffer: GOEX (-2.5%) from explorers lagging or SIL (-2.7%) from silver lagging gold lately.

Our contributor driven explorer and junior miner spreadsheet is among the squad, giving back 2.2% since Apr 7. Over the fortnight there are 6 advances against 13 losses. PLG and Continental Gold are down double digits, while Osisko backed off 9.5% from its ATH. The 21.6% rally of Almaden Minerals cannot compensate for that. Over the long haul we still have 9 advances against 10 declines for an aggregated gain down to 8.41%.

Gwyde
Sun, Apr 30, 2017 - 2:46pm Gwyde
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Miners leveraging down retreating precious metals

Nasdaq breaking above 6000 has been the event of the week; especially since 5000 was first reached over 17 years ago by the end of the tech boom. The victory of E. Macron in the first tour of the French presidential elections has been a relief: after Trump and Brexit no third surprise.

The fear trade is on the back seat and gold was weaker, though ending Friday with an uptick. The yellow metal eased 1.26% over the week, closing at $1267.7. Silver continued its slide with a 4.13% weekly loss to $17.16. At 73.88, the Au:Ag ratio posts a fresh 2017 high. In the mean time Au:Pt stands at 1.343 at a sigh of its all time high. Platinum slid 2.68% over the week to $944/Oz, while Palladium confirms its outlier reputation, firming 4.16% to $827/oz.

Sliding 6.64% over the week, the HUI is leveraging down the retreating gold price. Poor operational results for Barrick contributed to this, as the miner slid almost 16%. Only few HUI components (AEM, EGO) firm against the trend. You find more on the gold miner pulse page. The HUI residuals compared to the regression line have been negative for several days now, indicating miners lagging gold.

Miner ETF's aren't off much better than the HUI, with declines ranging around 6%. Only SIL shows some remarkable resilience easing less than 3%, despite the silver slide. With a 4.8% decline, our contributor driven explorer and junior miner spreadsheet is slightly ahead of most peers. The long term advance thins to 3.2% while B2Gold again posts a long term loss. We now have 8 long term advances against 11 declines.

Over the week we only have Oceana gold and Timmin's Gold rising (a little) against the trend, whereas the 19% slide of Sandstorm was pretty hard to digest.

Gwyde
Sun, May 7, 2017 - 5:02am Gwyde
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Early signs of a bottoming process

American stock market keep firming to fresh all time highs. Precious metals however are not at the party: gold slid 3.14% to $1227.9. Silver plunged another 4.95% to $16.31. The Au:Ag ratio (75.34) peaked at a fresh YTD high. On Wednesday, the Au:Pt ratio put down a new all time high of 1.381 with the metal closing at $896/Oz. Over the week, platinum slid 3.4% to $912, while Pd limited the damage to 1.45%, closing at $815. The price gap between the two is down below $100.

Sliding 3.1% over the week, the HUI is proving exceptionally resilient. This may be an early sign of a bottoming process for precious metals: at least this is what investors seem to expect. HUI/Gold keeps steady at 0.1515. You find more on the gold miner pulse page. The HUI residuals compared to the regression line are recovering to a neutral stance. Miners no longer are oversold.

Miner ETF's aren't off any better than the HUI, with declines ranging between 3 and 6%. With a 5.6% decline, our contributor driven explorer and junior miner spreadsheet is among the squad. However this consecutive slide eroded away all long term gains: we now are down 2.79%. There still are 8 long term advances against 11 declines.

Gwyde
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