From Collin Kettell: Precious metals analyst Jordan Roy-Byrne is still bearish and on the sidelines in this market, for him to turn bullish he needs to see gold make a strong move above $1300.
It’s currently breaking a bit above the trend line, but the overall sentiment is still largely negative. For a rally in mining stocks to occur he would want to see higher prices in the ETF’s.
The bearish perspective is that the dollar is very oversold, it’s reached 13-month lows, and it’s likely to rebound. Gold traded sideways during this decline and against foreign currencies, it has been quite weak. As a result, gold may get hit again when the dollar rallies. Jordan thinks there will be some sort of inflection point in junior mining stocks in the weeks and months ahead.
He discusses trading strategies for dealing with mining stocks and how having some cash on the sidelines is healthy. Exploration companies are outperforming and there are some good optionality plays. Triumph gold looks fantastic as such a play.
He examines the Canadian dollar, the potential housing bubble is a potential looming problem. The Canadian dollar looks to have been oversold, it could move up a bit more, sentiment for it is really bullish right now.
The SPDR Gold Trust ETF (NYSE:GLD) fell $0.21 (-0.17%) in premarket trading Monday. Year-to-date, GLD has gained 10.11%, versus a 11.48% rise in the benchmark S&P 500 index during the same period.
This article is brought to you courtesy of Palisade Research.