Loading ...Incredible reversal in the silver miners from last week to this week…
AXU is the posterboy for the sector. Up 25% last week.
This week, we have an outside week down candle (so far). That is an absolutely incredible reversal. You can also see from the cloud support, it is hanging on by a thread. Talk about going from hero to (potentially) zero in the space of days….
everything gets thrown out with margin calls, fear.
The big whammy is if this virus really gets out of control it shuts down operations in 6-12 months for mining firms.
Worldwide pandemic to me is inevitable.
The market has NEVER experienced this.
If the silver miner bulls have any hope, tomorrow and next week’s price action are the most important in the last few years. It looks extremely grim right now though. With this much downside momentum, it seems hard to believe that they will just reverse on a dime (yet again) by tomorrow or next week. Last week obviously is looking like an incredible headfake.
The negative divergence with the price of gold and silver is pretty sickening.
Nautilus, it seems like your cycle count/timing band call of the possible top was right on the money. I for one would appreciate your further input on the cycles. Thank you.
We’ll see. Until this week’s peak in gold in taken out, that scenario is still on the table. The last 2 weeks’ ridiculous action in the silver miners has me thinking more and more that the cycle top is in, but I am not trading around that hunch. I am still a bull, and am expecting $silver to finally break out of its slumber within a few months in the worst case.
Was that a potential daily cycle top or an intermediate cycle top you were seeing?
Intermediate top.
looks like a whole fleet of crop DUSTers, both big and small, took off today.
Selected gold miners still may do well financially even in the worst pandemic scenarios. Their stock prices may get temporarily hit — badly, badly, badly. But their share prices should rise pretty soon.
Gold mining companies need enough workers to keep operations going in case influenza-like problems occur. The virus *usually* is not worse than influenza for people under 60 apparently. Are there some key executives or managers who are absolutely necessary or the company implodes? Some companies are so iffy that the answer is probably yes, but not all of them. Even so, most of the 60+ people who get the bug survive. The companies if they are to be most likely to be secure need revenues from largely from gold. Silver prices may be unreliable (could be up or down). Copper and metals are unlikely to help as much with revenue. Composition ores may therefore be important.
They need cash on hand or especially good credit. They need not to have bought in to the just-in-time delivery ideas to extremes. Ideally over the past month they might have even been stocking up on supplies. Now if they have cash they may be able to get some real bargains for some of the things they need (fuel for example). Later they can pillage less well run nearby companies for some cheap trucks perhaps — or buy those companies for next to nothing. They will be producing a product that is likely to be wanted and probably at low cost at least after a few months. Not all of them will produce necessarily in the gloomiest scenarios. Some however may do awfully well — think of Homestake in the 1930s Depression, for example, even though I think it had to sell to the US gov’t at a suppressed gold price for an extremely, extremely approximate analogy.
Similar arguments exist for royalty companies who have invested in some viable gold projects. The projects don’t have to be especially profitable. They just have to keep going and give the royalty companies gold.
Other gold companies, silver companies — maybe, maybe not. It depends on how bad things get. Even the current day Homestakes may see low share prices temporarily under horrible scenarios. But they should prosper.
–These comments are what I think far as I can tell–but I can’t know. I never worked in mining.