Gold Stock Launch In The Books; What’s Next

You may know me as the…

…guy.

The guy using the planets of an imaginary gold sector Macrocosm with proper fundamentals that are decidedly not imaginary but rather, are necessary to call a real bull phase or even bull market. By managing a strict set of macro and sector fundamental inputs (to the sound of crickets and little else in the sector) NFTRH and its subscribers had a front row seat to the now obvious gold mining launch as first the fundamentals came in line, followed by the technicals.

The reason this needs to be highlighted is because there is a popular Elliott Wave analyst out there * (among a few others) talking about how it’s all in the wave counts (unless they are revised, as often happens with EW) or other technicals, and fundamentals don’t matter. As if the answer is all technical and sentiment based. Well, those two things are important, but please. As happened in dramatic fashion when we became super bullish in Q4 2008, the fundamentals kicked in first and gave a green light to taking technical signals more seriously along the way. Look, I am a TA too, but The Men Who Stare at Charts exclusively are pitching only half the story.

I wrote this in November, when it was time to start becoming bullish. Gold stocks (HUI) then rallied into February.

A Notable Lack of Interest in Gold

This was written after we had noted the pumping by some in the gold community had become too vigorous in February. The sector promptly got hammered.

Gold Sentiment Lesson #3,000

Okay fine. You had a couple of good calls. What have you done lately? Well, lately (June 3rd) a subscriber update noted the Nature of the Gold Stock Launch.

The pullbacks will come and they will be harsh. But if this is a launch, as would be indicated by the fundamentals slamming into gear, it’s a buy/add the pullbacks situation. I’ll be keeping a close watch on the funda because if they remain strong I’ll remain strong. If not, I won’t. Right now they are strong and this launch from support reflects that.

For reference, a similar thing happened in Q1 2016 as the sector launched hard, but by late spring that year we were noting degrading fundamentals and the rally ended not long after. Let’s not see that happen this time and then maybe we can get a real and sustainable move out of this. We’ll track the funda ever so closely moving forward.

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* I take the liberty to comment as the writer once publicly trolled me about how fundamentals don’t matter and it’s all in the wave structure in a string of comments to a fundamental ...

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