Gold Mining Shares: +70%… And This Is Just The Beginning

Most advisers in the gold space have been burnt, so many times, they’re now constantly warning their clients. As a result, these clients are not comfortable to buy anything gold: physical, miners, futures, whatever …

You’ve probably read some of these lines, coming from our competitors:

• Wait for a pullback in gold;
• Gold miners are in overbought territory;
• Although expensive, buy some protection, just in case;
• …

And that’s a damn shame! These investors have been missing out on the recent blast in the gold market. The gold price is up 19% YTD, while gold mining stocks are on a tear, jumping more than 70% since its recent low in January.

Seventy per cent! Now that’s we call a SECULAR TURNAROUND. And most investors are still waiting, and missing out, precisely because their investment advisers are holding them back. TOO BAD.

We, as you have been reading here week after week, have been banging the table. Almost screaming to buy gold, but more specifically to buy the Best Gold Stocks.

And still, it feels like we are yelling in a desert!

‘So, you guys think there won’t be any pullback in the price of gold?’

Well, dear reader, prices in financial markets always go up and down. But no one can predict prices in the short run. Nobody. Everybody who states the opposite, is cold hard lair. In the short term, it’s just a guessing game. And that’s the only truth!

Look at secular trends, multi-year price evolution, and there you can always see a price pattern. Have a look at the monthly chart of the HUI-index, the leading gauge for gold and silver miners.

As you can see, the price of the HUI just crossed the 24 month-average… That’s right, the two-yearly price trend. Every time this index broke this average to the upside, the sector would stay in RALLY MODE for years to come.

More over, the technical momentum indicators RSI and MACD have been showing positive divergences on a monthly basis. This underscores the current secular turn.

Did the HUI rally non-stop afterwards? Of course not, there are always timely dips, but as you can see, there wasn’t a lot of downside in any case.