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GOLD SHARES / such as: GDX, GDXJ, CDNX etc.

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Cheap? Yes they are, as the man (in the above article) says:

 

Gold stocks are actually as cheap now as they were near 2008's panic nadir! And if the sentiment cycle that has been so consistent across this entire bull swings back in favor of these stocks, thus drawing investors back in, then I submit to you that this sector, especially the juniors, is poised to explode. And I'm not talking a violent explosion that will lay waste to gold stocks like so many believe, I'm talking an explosion akin to a rocket ship blasting off into space.

 

Now is the time where the mettle of true contrarians is tested. And the rewards for the brave can be legendary, especially in the beaten-down junior gold stocks. As seen in the first chart, the juniors (GDXJ and GLDX) have big downside leverage to the larger less-risky major producer stocks (GDX). But when gold stocks are in favor, and the majors start to rally, the juniors usually provide big positive leverage.

 

But they can get cheaper, especially if Gold falls further.

 

This HUI/Gold Bugs stock index chart was sent to me by a friend who works at a Hedge Fund

 

huibr.gif

 

I think we would all like to see Gold rally from here, and the set-up looks good for that to happen to me.

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Does anyone know of a spreadbetting account that has a good range of Canadian junior miners.

 

I want to buy (go long on)

 

ALEXIS MINERALS CORPORATION

Rusoro Mining

Dynasty Gold

Aura Minerals

Victoria Gold

ORVANA MINERALS J

Full Metal Minerals

Carbine Resources

Crocodile Gold

Goldex Resources

 

Options are not an option as I don't want to pay income tax on my profit

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Does anyone know of a spreadbetting account that has a good range of Canadian junior miners.

 

I want to buy (go long on)

 

ALEXIS MINERALS CORPORATION

Rusoro Mining

Dynasty Gold

Aura Minerals

Victoria Gold

ORVANA MINERALS J

Full Metal Minerals

Carbine Resources

Crocodile Gold

Goldex Resources

 

Options are not an option as I don't want to pay income tax on my profit

I have now, or have had several of those.

 

I wouldnt be too keen right now on DYG.

Them may soon sell their asset in China, and I am not at all sure how much they would get for it.

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I have now, or have had several of those.

 

I wouldnt be too keen right now on DYG.

Them may soon sell their asset in China, and I am not at all sure how much they would get for it.

I'm wondering if I should go on another crazed buying spree or sit tight for a while.

 

I have recently bought

 

Great Basin Gold Ltd

& Solomon Gold

 

and I bought all these last year (EDIT: I bought most of them between Mid September & New Year and a few others in January)

Agnico-Eagle

Anglogold Ashanti Ltd Ads

Aurico Gold

Aurizon Mines Ltd

Avocet Mining

Axmin Inc

Barrick Gold

Centamin Egypt

Cga Mining Ltd

China Gold Int Resources Corp

CLAUDE RES

Coeur d Alene Mines Corp

Eastern Platinum Limited

Eldorado Gold Corp

Endeavour Mining

ESPERANZA RESOURCES CORP

Focus Minerals

Gold Fields Ltd Adr

Goldcorp Inc

Great Panther Silver Ltd

Great Panther Silver Ltd

Harmony Gold Mining Co.

Hecla Mining Co

Iamgoldcorp

Kingsgate Consolidated Ltd

Kinross Gold

Kirkland Lake Gold Inc

MDN INC

Minera IRL Ltd

Nevsun Resources Ltd

Newcrest

Newmont Mining

OROSUR MINING INC

Pan American Silver Corp.

PERSEUS FPO

Petropavlovsk

Randgold Resources Ads

SARACEN FPO

SEMAFO INC

Silver Standard Resources

Silvercorp Metals Inc

ST. ANDREW GOLDFIELDS LTD

Vista Gold

WESDOME GOLD MINES LTD

Alamos Gold Inc

Alexco Resource

Dundee Precious Metals

Endeavour Silver Corporation

First Majestic

Fortuna Silver Mines

Gold Resource Corp

Hochschild Mining PLC

Integra Mining Ltd

IMPACT SILVER CORP

Minefinders

Medusa Mining

New Gold Inc

OCEANAGOLD CDI 1:1

ROYAL GOLD

RICHMONT MINES

Resolute Mining Ltd

RIVERSTONE RESOURCES INC

St Barbara Ltd

Silver Wheaton

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I'm wondering if I should go on another crazed buying spree or sit tight for a while.

 

I have recently bought

 

Great Basin Gold Ltd

& Solomon Gold

 

and I bought all these last year (EDIT: I bought most of them between Mid September & New Year and a few others in January)

Agnico-Eagle

Anglogold Ashanti Ltd Ads

Aurico Gold

Aurizon Mines Ltd

Avocet Mining

Axmin Inc

Barrick Gold

Centamin Egypt

Cga Mining Ltd

China Gold Int Resources Corp

CLAUDE RES

Coeur d Alene Mines Corp

Eastern Platinum Limited

Eldorado Gold Corp

Endeavour Mining

ESPERANZA RESOURCES CORP

Focus Minerals

Gold Fields Ltd Adr

Goldcorp Inc

Great Panther Silver Ltd

Great Panther Silver Ltd

Harmony Gold Mining Co.

Hecla Mining Co

Iamgoldcorp

Kingsgate Consolidated Ltd

Kinross Gold

Kirkland Lake Gold Inc

MDN INC

Minera IRL Ltd

Nevsun Resources Ltd

Newcrest

Newmont Mining

OROSUR MINING INC

Pan American Silver Corp.

PERSEUS FPO

Petropavlovsk

Randgold Resources Ads

SARACEN FPO

SEMAFO INC

Silver Standard Resources

Silvercorp Metals Inc

ST. ANDREW GOLDFIELDS LTD

Vista Gold

WESDOME GOLD MINES LTD

Alamos Gold Inc

Alexco Resource

Dundee Precious Metals

Endeavour Silver Corporation

First Majestic

Fortuna Silver Mines

Gold Resource Corp

Hochschild Mining PLC

Integra Mining Ltd

IMPACT SILVER CORP

Minefinders

Medusa Mining

New Gold Inc

OCEANAGOLD CDI 1:1

ROYAL GOLD

RICHMONT MINES

Resolute Mining Ltd

RIVERSTONE RESOURCES INC

St Barbara Ltd

Silver Wheaton

 

Zik, you up to your old tricks? S'all right wit me, but bubba gon get raged.

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Zik, you up to your old tricks? S'all right wit me, but bubba gon get raged.

 

I don't understand your question. It can be read in more than one way.

 

I'll assume you don't believe I bought the shares. To which my reply is: It doesn't make a difference to my bottom line if forum members don't 'believe' in my shares. It only matters that the Law maintains my benefits of ownership.

 

Moving on:

I decided to go on a small buying spree yesterday. I've gone long (using spreadbetting) on

 

Northern Dynasty

Exeter Resource

Intrepid Mines

PINETREE CAPITAL LTD

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Gold is up 1% but GDX/GDXJ are down over 1%. Why so?

 

 

Zeal033012A.gif

 

In trying to wrap my mind around this gold-stock carnage, like most investors I’ve taken part in my fair share of commiserating in recent months. And in talking with numerous acquaintances that have been active in this realm for an extended period of time, I’ve been taken aback by the amount of negativity towards gold stocks, especially the juniors.

 

 

 

Now of course the vast majority of investors are going to hate any sector if recent performance is rotten. This is the psychology of the markets. But gold stocks have endured previous slumps like this, and there’s always been a steady group of contrarians that have used these situations to back up the trucks and load up for the next upleg. But man, even many of the tried-and-true so-called contrarians seem to have capitulated, all but abandoning this sector.

 

Read full article: http://www.zealllc.com/2012/jnrexpld.htm

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Gold is up 1% but GDX/GDXJ are down over 1%. Why so?

I've been saying for years that gold itself would outperform the stocks. Why? Because gold is a form of liquidity, stocks are an investment. Debt deflation also equals asset price deflation and therefore it's predictable that stocks will underperform.

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I've been saying for years that gold itself would outperform the stocks.

...

This chart shows you have been incorrect over the measured period.

 

huivsgld.png

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This chart shows you have been incorrect over the measured period.

 

huivsgld.png

You've chosen to start your chart from the bottom of the deleveraging in 2008 odd. HUI being more volatile, probably dipped quite a bit lower than gold and then would have also rebounded much quicker. Why not re-post the chart dating from a few years earlier? Anyway, as the above chart shows, the gains since July 2010 have been lost in HUI. Gold's gains have been slower but held since 2010.

 

The volatility will be greater in the stocks. Silver even more than stocks is a good example of the 'leveraged' volatility to both sidea. Gold should do better in the aggregate/ Long Term trend.

 

Of course, I'm not anti-stocks... just that for my purposes I choose to focus on gold, and then trade the volatility in bullion related instruments [such as HUI]. Who knows, maybe stocks will explode to the upside one day... just I'm not going to bet on it.

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Does the chart surprise you?

 

I chose the start date for 2 reasons.

 

1. Despite the poor performance of gold stocks recently, they're actually doing quite well compared to gold when measured from the 2009 bottom onwards. 3.5 years is not a short period. There's still more than 25% in it!

 

2. The other reason I chose that date is because the HUI/Gold ratio is approaching a level we've only seen twice in this entire bull market. See the chart below. The last time the HUI/Gold ratio got to these levels (around the time my chart above starts), HUI blasted off and out performed gold for years.

 

 

 

Zeal032312A.gif

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Does the chart surprise you?

No.

 

I chose the start date for 2 reasons.

1. Despite the poor performance of gold stocks recently, they're actually doing quite well compared to gold when measured from the 2009 bottom onwards. 3.5 years is not a short period. There's still more than 25% in it!

 

2. The other reason I chose that date is because the HUI/Gold ratio is approaching a level we've only seen twice in this entire bull market. See the chart below. The last time the HUI/Gold ratio got to these levels (around the time my chart above starts), HUI blasted off and out performed gold for years.

 

You're making out a case for trading HUI in the Medium Term because it's more volatile than gold. Great, that is the point of this thread. I'm not arguing with that [i do a similiar trade with silver]. My point was a simple one; that in the aggregate/ Long Term gold will outperform stocks [it may also outperform in the immediate term due to the fact that there are various drivers to the price of gold].

 

As we all know, the periods of 'risk on' trade will see the more volatile HUI up, but the periods of 'risk off' trade will eat up a lot of those gains.... the sort of thing you want to trade. Whether you decided to buy gold or HUI at the bottom of the deleveraging in '08 would've depended on whether you were trading in the Medium Term or investing in the Long Term right?

 

As an aside, HUI on the longer term chart posted above resembles silver more than gold reflecting its greater volatility to both sides in the Medium Term..

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Interesting chart - showing HUI is ahead of GOLD

65482381.png

 

But it may obscure the fact the the RATIO of HUI-to-Gold is at its recent LOW of 27%

 

77286416.png

 

Back in late 2008 the Low for HUI was : $151.57 (Oct.27, 2008)

 

At the same time GLD was : $72.18 / Gold was : $730.50 (GLD x10.12)

 

So the Ratio on the low was: 20.7% /Oct. 27, 2008

(And a low of about 21% is shown in the chart in post #87)

 

Of course, HUI was much lower in 2001. The Low-for-the-Year was $60.24 (Nov.26, 2001.)

The gold price was: $272.60, for a Ratio of: 22.1%

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Where are we now in relation to these old Price targets ?

GDX / Gold Miners etf ... GDX-chart : GLD-chart+144dMA : GDXJ-chart : GDXtoGDXJ

gdx.png

 

GDXJ vs. GDX and GLD/Gold ... update : LT-w/HUI

gdxjetc.png

Targetted Prices : Last Close:

GDX* : "$46 - 48" : $46.20 - $0.505 (thursday)

GDXJ : about $22 : $22.47 - $0.36 (thursday)

*there was also a lower target at $39-40

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Zeal032312A.gif

 

Very interesting chart.

I've been watching this ratio closely so am quite aware of the current abberation. To me it also confirms that gold and gold stocks are nowhere near bubble territory. If anything the opposite is still true and people are highly skeptical of gold investments. As ever, people would rather chase AAPL higher than be patient and buy something that the market is practically giving away.

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Performance of Crude oil futures compared to GDX over 3 years

GDXCL.png

 

They were reasonably well correlated for a time.

 

 

 

A look at the Crude Oil - GDX spread (Crude Futures minus GDX) over 3 years;

CLGDXspread.png

 

Could nearing the top of the channel signal an impending low in GDX?

 

 

Crude Oil - GDX spread with GDX

SpreadGDXcomparison.png

 

Lows along the channel were good points to sell GDX, highs were good points to buy, with the exception of the end of April last year, but that was an obvious period of excess in the precious metals sector.

 

 

 

 

GLD and GDX performance over 3 years

GLDGDX.png

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Right now, I see HUI bottoming somewhere between 300-400. The fact that the HUI/Gold ratio is at late 2008 levels, does not mean HUI and gold can't go lower.

Not there yet.

The ratio is at 27%, and prior major lows have come at 21-22%

 

If Gold= $1600, then:

21% = HUI-$336

22% = HUI-$352

25% = HUI-$400

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My point was a simple one; that in the aggregate/ Long Term gold will outperform stocks [it may also outperform in the immediate term due to the fact that there are various drivers to the price of gold].

I think I understand your position but I don't understand the reason you've taken this position.

 

Gold is essentially a single entity but gold stocks are not a single entity. There are thousands of gold stocks.

 

Some are better than others.

 

I'm sure you will agree; there are people on this forum capable of picking gold stocks that have/do/will out perform gold over a set term

 

See the chart below. I have not spent hours trawling for this. I have simply charted the first quality gold stock I could think of against GLD for the longest period available.

 

gldvsrrs.png

 

Uploaded with ImageShack.us

 

 

As we all know, the periods of 'risk on' trade will see the more volatile HUI up, but the periods of 'risk off' trade will eat up a lot of those gains.... the sort of thing you want to trade. Whether you decided to buy gold or HUI at the bottom of the deleveraging in '08 would've depended on whether you were trading in the Medium Term or investing in the Long Term right?

...

I'm not sure how to answer your question. You've tagged one Term with 'trading' and the other with 'investing' - I'm not sure why you've done this.

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Is anyone buying at these levels?

 

I've been buying Canadian and US stocks this afternoon. I'll be on a UK buying spree tomorrow B)

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GDX versus GLD

 

This comparison suggests the stronger GLD/Gold prices are dragging GDX higher.

Let' see if GLD can get above resistance at GLD-$162

 

Daily ... update

 

gdxvsgld.png

 

Intraday/15min ... update

 

gdxvsgldid.png

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As a complete aside I would like you to create a sticky gold options trade thread bubb. I would be personally interested to follow the trades from conception to conclusion, all grouped in one place. I am sure there would be interest in your infrequent but relatively low risk trades. I know I am! This could be separate from the gold thread and your trading diary.

 

What do you think?

 

GB

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Anyone buying here?

I've got 3 shares on limit order at the moment. I carried out most of my buying over the past week or two.

 

As a complete aside I would like you to create a sticky gold options trade thread bubb. I would be personally interested to follow the trades from conception to conclusion, all grouped in one place. I am sure there would be interest in your infrequent but relatively low risk trades. I know I am! This could be separate from the gold thread and your trading diary.

 

What do you think?

 

GB

Here http://www.greenenergyinvestors.com/index.php?showtopic=14768

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