This has been a fascinating week in the markets. We saw Janet Yellen testify to Congress at a time in which by all appearances long-term Treasury bond yields have made a secular bottom over the past few months. Inflationary pressures will in time force the Federal Reserve to begin yield control.
On Monday I made an update on gold, silver, and mining stocks in which I noted that all three have been in a drawn out sideways consolidation trend since August. The way to trade in such a time is to use oversold dips as buy points. We got that last week and yesterday gold and mining stocks rallied enough that many gave buy signals on their daily stochastics, by having them go back above 20.
Take a look at the price of gold.
Gold is trading in a range with $1800 as support and $1950 as resistance. It now is setup to run back up towards that resistance level and once it breaks through it look for the next big up leg for gold to begin. That could start soon or it could be in the March or April period if the trading range persists long enough to cause the 200-day Bollinger Bands on gold to fall down below 15.00.
Many mining stocks rallied hard yesterday. For instance, PASS, which I have a position in was up over 7%. As far as big caps go, the one that appears to me to be in the simplest buy spot is Newmont Mining, as its 200-day Bollinger Bands are now closer together than any of the other ones.
I own shares of NEM. Yesterday my top stock pick for this month, Sonoro Gold (OTCMKTS: SMOFF) also went up over 4%. It is still in a good buy spot and had some more positive news yesterday too.
Yesterday Sonoro Gold issued a press release to report reporting that “remaining assay results from its 2020 drilling campaign at the Cerro Caliche gold project in Sonora, Mexico. The 2021 drilling program is currently underway with approximately 50 additional RC and core holes expected to be completed by the end of the first quarter. The latest assays further support the Company’s consideration of the viability for a bulk mining heap-leach development proposal with a conceptual throughput of up to 20,000 tonnes per day (tpd).”
The Sonoro Gold CEO & President Ken MacLeod and Chairman John Darch are going to hold a live webinar today on January 21st at 1:30 pm (PST). They will discuss the recent series of drilling & metallurgical results from the Cerro Caliche project site. Afterwards will be a live Q&A session.
To register for this webinar click here.
-Mike
Disclosure: Mike Swanson owns shares of Sonoro Gold Corp. Because it is a small cap stock with a market cap of less than $100 million he has put himself in a trading blackout on the stock and will not buy or sell a share of it for at least 30-days from the date of this post. Wallstreetwindow.com, is owned by Timingwallstreet, Inc., which is being compensated by a third party (Leadgopher LLC DBA Pinnacle Ad Network) to conduct an investor awareness advertising and marketing campaign for Inca One Mining. This third party paid Timingwallstreet Inc., $10,000 to produce and disseminate this and other similar articles and send traffic to them through paid advertising campaigns for 30-days from the date of this post (1/04/2020). This compensation should be viewed as a major conflict with our ability to be unbiased, more specifically: This communication is for entertainment purposes only. Never invest purely based on our communication. For more on trading risks read our policy statement by clicking here.
