Don’t Bungle the Burgle, Bilbo!
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Silver is quickening again and the dollar is drooping…
I remain, however, unconvinced that this was the only shaking we are going to get. Attend to me now. I do not recommend selling anything more in egregious fashion. Your selling should be all but done, as mine is, unless you’ve got an IRS-man’s butcher bill to pay this Friday, which I certainly do. In that case, you are forgiven for converting more silver-gold shekels into dirty unwashed lettuce.
The question remains, however, should we be buying again here? Is the coast clear? I’m sorry but I cannot warrant it. Things seem a bit too quiet if you know what I mean. And the symmetry of the cycles argues for a more pronounced drop in some of our more parabolic names… Take EXK for example:
Yes, we opened up above that green line, and even managed to stay above it, despite the lower closing black candle. But such a weakling day bodes ill for the future, even with a strengthening silver price. No, the clockwork of the universe demands a finer symmetry, and I believe that means we move to at least our 20-day EMA, which, in flattening, may bring us to our rising support line in the $10.00-10.50 area.
The feasting will be sweet there.
And there is another treasure I seek, with my arrows aimed at lower levels than we achieved today. That valued asset would be the damned elusive AG — which has plagued me since the mid-teens when I first laid traps to ensnare it. I’ve never owned it… preferring instead to hunt it with stealth at various tepid water-holes. Only raising my poisoned blow gun once… twice…. and now again:
Now this stock in particular is known for showing me the fool (as I haven’t caught it yet), and it very well could be showing a significant reversal here today from which it will never turn back. I’m just not sure of it, given the state of the dollar (seeking a rebound soon, I think) and the relative torpor recently evidenced in the price of gold.
My price is a little above the 50-day EMA on this one. I hope to snare some, but if not, God speed, and happy burgling.
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Another juicy morsel for our accounts. Thanks for the analysis. I’m in 50% PM’s with plenty of wilted lettuce in the fridge ready to be exchanged for the real thing…
Proverbs 11:25 for our Senator—- bless him Lord.
What a nice thing to say… 😉
(Not sure if I like the King James version, however… look it up for a laugh at my expense…)
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That’s so funny. Didn’t remember that. Tend to be in NIV these days.
given that you’ve caught the most ridiculous sector run-up since the dot-com bubble, you’ve got to be close to retirement.
If I didn’t have four kids, maybe.
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…and a younga brotha…
Hey Jake,
What cycle are you talking about? Are you looking at EW, ovebought signals, mean reversion? Or something completely different I’ve never heard about?
FWIW, I think one little last (2-3 day) pop-up before a little mini-correction.
thx
Just a daily cycle. Not EW… and not an exact science, either.
I agree on the last pop before the shanking.
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OK Thanks Jake.
NUSMF ramping today. It got a big promotion last night in National Inflation Association newsletter. They sent out another email this morning saying:
“NIA believes that Nautilus Minerals Inc. (TSX: NUS – NUSMF – pink sheets) could be our greatest gold discovery of all time! A major new development was just announced very late last night regarding NUS that we will get into in a minute.
NUS could make many NIA members very wealthy during hyperinflation. NUS is set to start up production at the world’s first offshore gold and copper mine as early as the second half of 2013. NUS has an area under title that is approximately one and a half times the size of the State of California or approximately two times the size of the UK. ”
They continue:
“At 10:41PM EST last night, NUS announced a huge new joint venture with shipping giant Harren & Partner to build the world’s best ever state of the art Production Support Vessel, which will allow NUS to make history by leading a new frontier of seafloor gold, silver, copper, and zinc mining!”
Their deal is seafloor mining. Apparently the only crew doing it.
I jumped into the fray before close at 2.98. Obviously wish I wasn’t as timid purchasing as it is up 14% this morning. They have had pretty good results with previous choices.
Have they produced anything yet?
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Doesn’t appear so. They got their first mining lease in January apparently.
March 24, 2011
Nautilus Annual Results
“In January, the PNG Government granted Nautilus the first Mining Lease in the Pacific region to allow deep sea resource development in the Bismarck Sea. The lease provides Nautilus with a 20 year licence to mine an area of approximately 59 km2 surrounding Solwara 1, 50 km north of Rabaul, where Nautilus intends to mine high-grade copper and gold deposits on the seafloor, at depths of approximately 1600 metres.”
I only bring this up as NIA has been pounding the gold/silver thesis probably as long as you have and have come up with some decent picks along the way. I enjoy their missives.
FWIW here is the newsletter from last night:
“NIA is pleased to bring you our favorite gold stock suggestion for the next three years. The company is Nautilus Minerals Inc. trading in Canada on the TSX under ticker symbol NUS and in the U.S. on the pink sheets under ticker symbol NUSMF.
NIA has been absolutely thrilled about the long-term success of its stock suggestions. We would like to congratulate our members on our most recent stock suggestion PC Gold (TSX: PKL), which reached a high this week of $1.13 for a gain of 36% since we suggested it on March 7th at $0.83!
NUS has 155.6 million shares outstanding giving it a current market cap of $403 million at the current price per share. In our opinion, we believe NUS is undervalued and has a significant amount of upside potential. NUS is extremely unique and focused on a very attractive niche market that is completely undiscovered.
NUS is the only company of its kind in the entire stock market and we believe could receive major publicity in the near future as precious metals continue to rise substantially. NUS is the first company to commercially explore the ocean floor for gold, silver, copper, and zinc deposits and is currently developing its first project! NUS is developing a production system using existing technologies adapted from the offshore oil and gas industry to enable the extraction of these high grade Seafloor Massive Sulphide (SMS) systems of gold, silver, copper, and zinc on a commercial scale!
Let us give you a little insight as to what exactly SMS is. SMS deposits form directly on the ocean floor where superheated water carrying metals deep in the earth, mixes with cold seawater at the bottom of the ocean, depositing metal-rich minerals. They are considered the modern analogues of volcanogenic massive sulphide deposits, historically a major source of the world’s copper, zinc, gold and silver.
There are hundreds of companies drilling offshore for oil and gas. In fact, the U.S. is currently producing 565 million barrels of oil annually (1.5 million barrels of oil per day) offshore. With oil at $106 per barrel, that’s $60 billion worth of oil produced offshore each year in U.S. federal waters alone! NUS is the ONLY company using this technology for precious metals. NUS is making history!
NUS holds approximately 186,269 square kilometers of granted tenements, and approximately 274,422 square kilometers of applications for tenements in the territorial waters and exclusive economic zone of Papua New Guinea (PNG), Tonga, the Solomon Islands, Fiji, and New Zealand.
NUS’s main focus is the Solwara 1 Project, which is the world’s first seafloor copper-gold project located in the territorial waters of Papua New Guinea in the western Pacific Ocean. You can read a study on this project here: http://www.nautilusminerals.com/i/pdf/NAT005_Solwara_1_Offshore_Production_System_Definition_and_Cost_Study_Rev_3_21_June2010.pdf
The Solwara 1 Project completed a SMS NI43-101 compliant resource estimate after 116 drill holes. NUS has an indicated mineral resource of 4.8g/t gold, 23g/t silver, [email protected]% copper, and 0.4% zinc and inferred mineral resources of 7.2g/t gold, 37g/t silver, 1,[email protected]% copper, and 0.8% zinc. Check out NUS’s recent press release confirming high grade gold mineralisation at Solwara 1: http://finance.yahoo.com/news/Nautilus-Minerals-Confirms-ccn-2318634305.html?x=0&.v=1
NUS made a very important milestone this year when it received the world’s first deep sea mining lease granted in January 2011, by the Government of PNG for a 20 year term. NUS anticipates production in 2 1/2 years with plans to produce ore at an annual rate of 1.3 million tonnes containing approximately 150,000-200,000 ounces of gold and 80,000 tonnes of copper. Based on current gold and copper prices, that equals approximately $1 billion in potential annual revenues!
NUS is such an amazing ground-floor opportunity that even the Government of PNG has signed an agreement and exercised its option to take up a 30% stake in the Solwara 1 project!
NUS has an amazingly strong management team, and has some of the world’s leading geologists, contractors, and suppliers already on board! NUS has the expertise to develop this global opportunity.
NUS’s largest shareholders are three of the world’s leading international resource companies. Anglo American (AAUKY), a $62 billion mining company, owns 11.1% of NUS. Teck Resources (TCK), a $31 billion mining company, owns 6.8% of NUS. Metalloinvest, Russia’s biggest iron ore miner, owns 21% of NUS. Reuters just reported last month that Sberbank may buy 20% of Metalloinvest for $2.5 billion, which values the company at $12.5 billion.
These three companies, worth a combined $105.5 billion, own a combined 38.9% of NUS and are obviously banking that there is a HUGE future for deep ocean mining for precious and base metals, and that NUS will be the leader!
NUS currently has over $165 million in cash and no debt. Quite simply put, NUS has a very solid and strong balance sheet and will have no problem reaching production and becoming the first and only company in history to produce precious and base metals from deep in the ocean!
If you subtract NUS’s cash position from its market cap, the market is valuing their technology, projects and resources at only $238 million! It wouldn’t surprise us if NUS is worth over $1 billion soon, and possibly tens of billions of dollars in about three years time! If oil companies are making billions from this same underwater technology and NUS is the ONLY company using this technology for precious and base metals, there is no reason why NUS should only be worth $403 million or a shockingly low $238 million after subtracting their huge $165 million cash position! Remember, we believe precious metals have more upside then oil and with gold, copper, and silver continuing to boom this could be the perfect storm. Although all of NIA’s stock suggestions should be considered high risk, NIA considers NUS to be a sure thing at this time, in comparison to our other gold stock suggestions.
At its current price of $2.59, we believe NUS to be a solid long-term stock suggestion and a great hedge against the current currency crisis and upcoming hyperinflation crisis! Very few stocks will outperform the price of gold this decade, but NUS is a stock that NIA believes could perform many times better than gold.”
Sold +12%. Will revisit as it settles back down.
Thanks Chris, very interesting.
I’m sure their initial costs will be high, but there may be unbelievably rich and untapped deposits.
I used to get NIA email but discontinued it, maybe I’ll reconsider.
NUS has been my biggest holding for years. Bought it for less than a buck, and I’ll never sell it.
I see that Zor has bought EXK at about 10.56 this morning.
Yes indeud .. a little pop then a shake out before we load up again. Thanks!
Oh and I’ll be stalking AG with you. I don’t have it either.
$XG. Jake…any chance you could do some chart analysis on this one sometime soon? TIA.
I’ll take a look tonight… it’s newness may make the charts a little questionable.
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Yes,agreed about the chart. Also the reason hard not to buy anyway…lack of technical measures. It could break down hard or simply run away here.
Should we be concerned with PAAS? http://www.vancouversun.com/business/Bolivia+plans+expropriate+mines/4610801/story.html
The Marxists always screws things up. The Bolivia mine makes up 12% of PAAS’ production. Looks like the market is not happy with the decision. I hope they take it down hard. Will be happy to pick up some shares on over reaction. They have other operations.
This is why I don’t play in Africa. It’s unfortunate, but South America has gone very far left — a la Barak Obama — in the last ten years. Between Bolivia, Venezeula and Ecuador, I don’t know who’s the best Castro clone.
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By the looks of it, I’m assuming CDE is getting the Guilty By Association Bolivian Homo Hammer of Death too.
Well once PAAS gets booted from Bolivia that will leave them with operations in Mexico, Peru, and Argentina, all fairly supportive of capitalism. Since Bolivia is 12% of their ops maybe I will dip back into PAAS when it is down, say 15-20%. That will put it hovering the 200 day. I’m guessing they can shift some of their resources to other holes.
Jake, why are so many of the silver and gold miners down YTD, while gold and silver are hitting new highs?
Sorry if you’ve gone over this before, but that just strikes me as odd…thx.
The ones that are down have shitty management. Some are China related, too — like EGO.
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The other reason is just cyclicality. If you recall, we were at multi-year highs in early December of ’10, and then we dropped into the annual lows in end of February, early March. We were still “high” compared to early ’10 numbers, but just experiencing a pullback from that monstrous early September to late November run.
In effect, we should be taking off again here soon into a cycle high that should peter out by the end of May.
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Thanks, because I would have thought that the miners would be running well ahead of the commodities.
It is odd… but they’ve been lagging them for the second half of this bull… probably the result of a maturing market that’s trying to catch up w itself.
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Talking about physical for a second.
The gold to silver ration is now at under 35 and I hold mostly silver. 95% silver 5% gold. I was wondering when/if you would be trading silver in for gold our are you having strong hands on physical silver and if so what is your target gold to silver ratio to trade them.
Thanks for your help
The Got Gold Report guys posted this afew weeks ago:
We intend to wait patiently, for years if necessary (haven’t we already?), for the time when less than 30 ounces of silver will “buy” an ounce of gold. At that time we plan to convert one-quarter of our silver into gold one-ounce coins. At 25:1 we will convert another quarter. And at 20:1 or better, yet one more quarter will go for the gold.
And if silver manages to get all the way to a 15:1 ratio to gold again (see the star on the graph), like it did in January, 1980, the last of our silver will be converted to real money. For comparison at $1,400 gold a 15:1 ratio is “only” $93 an ounce for silver.
1:5 gold to silver. Laugh if you will.
I will laugh.
At anything under 40:1 you are living on borrowed time. I have been weighting into gold on the AGQ I’ve sold.
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Why 40:1? In nature, the ratio is more like 15:1, and the above ground supply of gold is far larger than silver (due to industrial usages for silver). Average American can’t really afford to go buy a few gold coins (credit card debts, unemployment, etc.) but they can buy a little silver. Combine that with every look of serious manipulation of the silver market by JPMorgan and HSBC, to me those add up to a decent shot at 5:1.