While we could see sharp bounces in the precious metals miners imminently, I expect them to be ephemeral. Regarding major levels where I would surmise demand materializes with conviction, I am looking at the $45 level for Royal Gold, and the $18 area on Silver Wheaton, a premier silver miner. Their monthly charts are the first two which appear below. Despite RGLD looking to lose a ten-year rising channel, it need not mean the end of the secular uptrend, but merely a reset. Whether or not strong hands present themselves in the mid-$40’s should be an excellent indication of the sustainability of the decade-plus bull run.
The third chart is a follow-up to this blog post from earlier this month. POSCO displayed relative strength to all commodity stocks on Monday, including the steels. It has yet to go the way of letter X as far as a test of the 2009 crash lows. Bulls simply must defend against that retest, in my view, or the ominous setups in other commodity complex stocks like CAT and FCX are almost assuredly going to come to fruition for deflationary bears.
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Specifically using the above timeframes, let’s consider a major false breakdown scenario in RGLD and SLW.
Could just April’s close confirm the false move, or does the book say to wait and see both the closes of April and May before investing (1+ year).
For example, the flowers alone confirm the hagen daz.
CAT, macro-currency conditions favor the Jap manufacturers. Not saying the technicals need any BS fundamentals, but for people looking for an holistic justification for a US/Euro area heavy industries/machine tools etc crash – then this might be a way to understand the situation.
True, but OTOH, we may be close to the US saying Japan is a currency manipulator; that will be 20% tariffs on all your imports, please.
A $18 level on SLW suggests the price of silver in the teens. If so, the credit analyst in me sees the sharks really ramping up pressure on SLW at that point…