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Article by ForexTime

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Technical Analyst Clive Maund shares a chart analysis of all the HUI index constituents. 

Source: Clive Maund  (7/25/23)

On Wednesday of last week, the 12th, the precious metals (PM) sector broke strongly higher in response to a dramatic plunge in the dollar, as expected and predicted on the site in the article PM SECTOR update – REVERSING TO UPSIDE posted on the 3rd of this month. This breakout is believed to mark the start of an important and sizeable intermediate uptrend in the sector that should at least lead to very worthwhile gains and, depending on how things play out, could lead to spectacular gains, as the dollar is vulnerable to an unprecedented decline due to the fallout from its unfolding loss of global reserve currency status.

Because the fixed costs affect all larger gold mining companies, the rising gold price tends to benefit all of them simultaneously, which is why they all advance higher like a flock of sheep moving together.

While some junior PM mining stocks can and will make huge gains on the back of the expected major uptrend, the more reliable way to play this uptrend, especially for those of more limited means or for whom safety is more important than the prospect of massive gains, is by investing in large and mid-cap gold (and silver) mining stocks.

This is, of course, because large-cap gold mining companies are more established and stable and thus less likely to fall victim to the vagaries that frequently afflict juniors. Because their costs tend to be fixed, the biggest determinant of their bottom line profits is the gold price, and when gold prices rise significantly, the extra revenue generated feeds straight through to their bottom lines.

This is why, when gold prices trend higher, the biggest gold stocks tend to reliably trend higher too, and because of the high fixed costs, the gains made by gold stocks leverage the gains made by gold itself, which is why they are such attractive investments when gold trends strongly higher in the manner that is expected shortly.

As we can see, the HUI Index has had a normal correction over the past couple of months back to the lower boundary of the large uptrend channel shown, with the correction taking the form of a bullish Falling Wedge that presaged a new uptrend.

Because the fixed costs affect all larger gold mining companies, the rising gold price tends to benefit all of them simultaneously, which is why they all advance higher like a flock of sheep moving together, as alluded to in the article posted on the 3rd, in which Royal Gold and Victoria Gold were highlighted as looking very attractive. This is not to say that you shouldn’t go for selected juniors too, but the larger golds that we are looking at here are considered to be bedrock material for a PM stock portfolio.

The companies whose charts are presented below are the constituents of the HUI GoldBUGS index. The XAU Gold and Silver index is not considered because it includes big silvers, which we are going to look at soon in a separate similar article. A 1-year timeframe has been selected for all the charts because it shows the major uptrend that is still in force back to its origins back in September through November of last year. The constituent stocks are presented in alphabetical order. Due to the number of them, commentary, apart from what is written on the charts, is of necessity brief.

The logical point for us to begin is, of course, with the chart for the HUI index itself, which does not not have volume data. As we can see on it, it has had a normal correction over the past couple of months back to the lower boundary of the large uptrend channel shown, with the correction taking the form of a bullish Falling Wedge that presaged a new uptrend, as was the case with a good number of individual stocks too.

Agnico Eagle Mines Ltd. (AEM:TSX; AEM:NYSE)

Moving on now to the constituent stocks of the HUI index, we start with Agnico Eagle, which presents a clear and straightforward technical picture of a stock resuming its larger uptrend after a normal correction.

AngloGold Ashanti Ltd. (AU:NYSE; ANG:JSE; AGG:ASX; AGD:LSE)

The technical picture for Anglogold Ashanti is especially clear and orderly — it hasn’t quite broken clear out of its corrective downtrend but should do soon.

Augusta Gold Corp. (G:TSX.V: AUGG:OTCQB)

While at first sight, the chart for Augusta Gold does not look anywhere near as positive as that for most of the stocks in the HUI index, if we look more carefully, we can see that it is now completing the Right Shoulder of a Head-and-Shoulders bottom that on shorter-term charts is a clear and fine example of one of these patterns and you may recall that we bought it down in the Head of the pattern.

If it succeeds in breaking out of the larger downtrend channel shown, as it should, a sizeable uptrend will be in prospect.

Barrick Gold Corp. (ABX:TSX; GOLD:NYSE)

Although Barrick’s larger uptrend is not quite as robust as some of the other stocks in our list, we can see on its chart that it is already “on its way,” having broken out of the corrective downtrend and completed an intermediate base pattern above the lower boundary of the big uptrend channel and is now embarking on a significant intermediate uptrend that could see it ascend to the top of the big channel and perhaps higher depending on what unfolds.

Compania de Minas Buenaventura (BVN:NYSE; BUE:BVL)

BVN has been in larger corrective phase going back to last November but started its new major upleg earlier than most stocks, following the low late in May, and looks like it is limbering up to take out the strong resistance level shown, and given the now positive outlook for the sector over coming months it shouldn’t have much trouble overcoming it and of course, once it does, we can expect its rate of advance to accelerate, taking it to the upper boundary of the large channel as a minimum objective.

Eldorado Gold Corp. (ELD:TSX; EGO:NYSE)

Last week, after completing an intermediate base area above the support of the lower rail of its major uptrend channel, Eldorado broke higher to commence its next major upleg.

If it ascends to the upper boundary of this channel again, considered very possible, it will result in worthwhile gains from here.

Gold Fields Ltd. (GFI:NYSE; GFI:JSE)

Gold Fields is looking really strong here. Last week it broke out of the corrective downtrend that was notably shallow compared to the powerful upleg that preceded it, so the larger uptrend appears to be accelerating.

This is bullish and means that the next upleg now starting is likely to be big too.

Harmony Gold Mining Co. (HMY:NYSE; HAR:JSE)

Harmony presents an especially pleasing picture of a fine and orderly uptrend with the next major upleg just getting started. The one disharmonious aspect is the weak Accumulation line up to now.

However, given the favorable look of the charts for other stocks, it should move up with them, and ideally, the Accumulation line improves when it does.

IAMGOLD Corp. (IMG:TSX; IAG:NYSE)

Even though IAMGOLD made new highs in May, all of the action from the January peak looks like a running or upsloping correction to the powerful runup from late September through late January that saw the stock almost triple in value.

Such upsloping corrections are very bullish, and given the now favorable outlook for the sector, it means that another really powerful upleg is probably in the works that is believed to have just started.

Kinross Gold Corp. (K:TSX; KGC:NYSE)

Old Warhorse Kinross is looking pretty good here. The correction from early May to the steep recovery runup from the March lows has been shallow, and the price has already broken clear of it to start the next upleg.

This upleg should take it up the top of the large channel shown and possibly higher.

Newmont Corp. (NEM:NYSE)

Newmont has underperformed the sector in recent months, and its larger trend remains neutral at this point, although it should continue to rally with the sector.

However, on opportunity cost grounds, it is considered best to avoid it in favor of the many gold stocks with more robust charts.

New Gold Inc. (NGD:TSX; NGD:NYSE.MKT)

New Gold is looking good here. Its robust breakout from its corrective downtrend channel last week took it well clear of this channel, and it is now on course to run at the top of the large uptrend channel shown, which will result in good gains from the current price.

Royal Gold Inc. (RGLD:NASDAQ; RGL:TSX)

Royal Gold is one of the two large gold stocks that we went for a couple of weeks ago (three if you include Augusta Gold), the other being Victoria Gold which is not included here because it’s not a constituent of the HUI index.

Royal Gold makes quite big percentage gains in a relatively short space of time when it’s in the mood, and it looks like it’s in the mood now, having broken out of the corrective downtrend to begin a major upleg that should see it run to the upper boundary of the large uptrend channel shown.

With reference to the title given to this article that includes the phrase “happy days are here again,” some of you may be in the mood to celebrate, and you can join in by following this link to the original song “Happy Days Are Here Again,” although it is doubtful if even some clivemaund.com subscribers are old enough to remember when it was first aired.

_{Posted on CliveMaund.com at 3.38 pm EDT on July 16, 2023.}

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Important Disclosures:

1. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Agnico Eagle Mines Ltd. and Barrick Gold Corp.
2. Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
3.  This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.

For additional disclosures, please click here.

CliveMaund.com Disclosures

The above represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maund’s opinions are his own, and are not a recommendation or an offer to buy or sell securities. Mr. Maund is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations mentioned in his reports. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund’s opinions on the market and stocks can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction.

Source: Clive Maund  (7/13/23) 

Technical Analyst Clive Maund takes a look at the jump in the price of gold and the decline of the dollar.

Gold silver and precious metal (PM) stocks staged a major breakout yesterday as the dollar cratered to signal the onset of a major devaluation as its loss of reserve currency status becomes a physical reality. The BRICS are set to introduce an alternative CBDC related gold backed currency of their own that should drive the last nail into the dollar’s coffin. This has been “in the works” for quite a while and this being so it only is surprising that it has taken the dollar this long to break down. We saw all this coming a couple of weeks ago in the article PM SECTOR update – REVERSING TO UPSIDE and the two larger gold stocks featured in the article, Royal Gold and Victoria Gold have soared.

Anyway, the point is that the PM sector – and commodities generally – are embarking on a long and powerful upleg that is still in its earliest stages and this being so you can basically put on a blindfold and throw darts at a list of PM stocks and pick winners although of course we will strive to do somewhat better than that.

Now we will proceed to look at a range of charts showing the dollar breakdown and the PM sector breakouts yesterday that I am confident will “make your day” if you are long the PM sector…

We’ll start with the dollar which is of course the cause of the PM sector breakouts yesterday. The dollar cratered yesterday with a breathtaking 1.2% drop in the dollar index which broke it down from the bear Pennant it has been stuck in since late January.…

Meanwhile, the Canadian dollar, in common with many other currencies, broke higher against the US dollar yesterday, although as we can see, it had already started to break higher against the US dollar by the middle of last month. The Canadian economy is much more resource-based than the US and advancing metals prices should have a beneficial effect. Investors in Canadian mining stocks can therefore expect an additional benefit from relative currency appreciation, relative because all currencies are depreciating in real terms, if not against each other…

On gold’s 1-year chart we can see a quite lovely breakout yesterday from the corrective bullish Falling Wedge that brought it back to an important buy spot at the lower boundary of its larger uptrend channel and as we can clearly see, there is ample upside back up to the top of this channel – and there is nothing to say that, given the enormity of what is going on in the world, that it won’t in due course proceed to accelerate out of the top of this channel…

Silver had a big breakout yesterday too and although its uptrend is not yet as strong as gold’s as its larger uptrend channel is converging, it will probably proceed to rectify this in time by busting out of the top of this channel…

The chart for GDX (PM stocks) not surpringly looks very similar to gold and we can expect a robust by the sector as gold advances. Don’t worry about it having risen a lot yesterday – this chart shows that it has much further to go.

The chart for the Canadian dollar looks strong too, like it is breaking out upside from a long period of consolidation. Its chart will be added to this article later today, so look out for that.

Incidentally there are a string of big white candles in James Turk’s GoldMoney’s chart (XAU.TSX) over the past week, suggesting that investors of piling into physical gold.

Amongst stocks looking good this morning that we will be looking at ASAP are Sierra Madre Gold and Silver Ltd. (SM:TSX.V) that has positive news out this morning and Spey Resources Corp. (SPEY:CSE; SPEYF:OTC; 2JS:FRA) is at a very good entry point too. Away from the PM sector Muscle Maker Inc. (GRIL:NASDAQ) put in a reversal candle at strong support yesterday and looks set to advance.

Posted at 9.30 am EDT on 13th July 23 on CliveMaund.com.

Important Disclosures:

1. Sierra Madre is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
2.  Spey Resources and Muscle Maker have a consulting relationship with an affiliate of Streetwise Reports, and pays a monthly consulting fee between US$8,000 and US$20,000.
3. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Spey Resources and Muscle Maker.
4. Clive Maund: I, or members of my immediate household or family, own securities of: none. I personally am, or members of my immediate household or family are, paid by none. My company has a financial relationship with none. I determined which companies would be included in this article based on my research and understanding of the sector.
5. Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
6.  This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.

For additional disclosures, please click here.

CliveMaund.com Disclosures

The above represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maund’s opinions are his own, and are not a recommendation or an offer to buy or sell securities. Mr. Maund is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations mentioned in his reports. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund’s opinions on the market and stocks can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction.

Source: Michael Ballanger  (7/3/23) 

With investors scrambling at buzzwords, Michael Ballanger of GGM Advisory Inc. looks at one company he believes is a winner beyond the exciting jargon of the day.

It seems that with the stock price down over 65% from the May 24 peak, Mr. Uhl decided to do what I have been doing, and that is buying more of that “glorified newsprint.”

I have spoken to Warner Uhl perhaps twice in my life going back to mid-2021 when I was trying to get a handle on the direction of his company (then called Allied Copper Corp.) after some early hiccups resulted in a trading halt. The second call was after I noticed his first (small) insider transaction, which was just after they announced the move to amalgamate with Volt Lithium Corp. Without hesitation, I rang him up after a brief conversation. I was delighted to learn that he was an aficionado of lithium as well as copper and that he would be staying on as Chairman.

Fast-forward to June 27, 2023.

Insiders of junior Canadian resource deals rarely buy positions in their own deals; they prefer to use the “Directors’ Incentive Options” instead of their own cash to beef up their notional, if not actual, ownership. With markets on the defensive and retail investors puking out positions at the first sign of any size bids, I found the recent insider activity at Volt to be a breath of fresh air but this last purchase by Mr. Uhl caught my undivided attention.

Why Buy Now?

Why buy now? I picked up the phone resulting in a 25-minute conversation with a man who, in his early career, toiled on the Mt. Milligan Project, and the best description of his contribution can be gleaned only after lifting it from his impressive resumé:

2009 – 2013 Project Director, AMEC (Mt. Milligan project)

• Project Director for EPCM services, in a joint venture with Fluor, for a 60,000 tpd copper-gold project with open-pit mining, conventional concentrator, gold gravity concentration, water treatment, tailings management, utilities and infrastructure, and an offsite concentrate loading and handling facility. Managed an engineering staff of 250 and an onsite staff of 120 persons overseeing a peak of 1,600 contractors. Oversaw the design, permitting, construction, and commissioning. The work that Mr. Uhl directed was built under budget and on time. Over 5.0 million man-hours without a lost-time accident. All this was accomplished with a very inexperienced industrial workforce and significant participation by local indigenous companies.

For the past several years, Warner has toiled for the mighty Worley Canada, providers of professional services in the energy, chemicals, and resources sectors (including copper and lithium). His title is “Regional Director for Study Management in the Americas, Technology and Expert Solutions, Worley, Canada.”

Warner has over three-hundred project study managers and engineers reporting to him on various projects within a larger company employing over 50,000 people and generating over US$10 billion in sales.

Now, buying 150,000 shares in the open market for CA$40,500 may not seem like a big deal, but to my sexagenarian eyes, it was like a message from the Messiah. I asked Warner today why he bought the stock, and his reply was quite simple. The market was missing the significance of the last press release, which, after third-party vetting and sign-off by Sproule Inc., reported that their pilot plant test confirmed the cost per tonne of a mere  US$3,977 required to produce 1,000 tonnes of lithium carbonate from the oilfield brines.

It seems that the “knock” on Volt is that few investors believe their claim that their Direct Lithium Extraction (DLE) technology actually works. There are a number of companies out there that shall remain anonymous that think that their DLE technology will work on a larger scale basis, but to date, nothing compares to Volt.

By calling Warner Uhl, whose company is currently working on a US$3 billion lithium extraction deal in Argentina, I asked a man that knows lithium extraction and all of the challenges to commercial processing of oilfield brines WHY he bought the stock. As obvious as the answer is to everyone close to the deal, It was almost an embarrassment to ask that question.

Volt Lithium Process

His answer was exactly as one would expect; based upon the extrapolation of prospective profitability using a DLE technology that he trusts, the stock price was “disconnected” from its market potential.

The market “disconnect” lies in the mistaken assumption that Volt’s claim is either overstated or false, but if one drills down into Sproule, one will quickly appreciate the significance of their involvement and why IIROC gave their blessing on the release.

Warner went on to explain the “green company” benefits whereby Volt returns formerly toxic brines to the subsurface aquifer in pristine shape, free of all impurities, including oil, for which they are paid a royalty by Cabot Energy. This is a feature of immense benefit to politicians, and with a great deal of government money allocated to the battery metals hunt and to water treatment, it is not a stretch to expect Volt to be approved for government grants as a means of defraying commercial development costs.

“I would urge all shareholders to do what they can to retain their positions because as a longer-term investment, I think they will do quite well.”

That is an endorsement of the highest order from Volt’s Chairman and a person with decades of experience in the building of mines around the world and who is on the record as a buyer of shares.

Under threat of “overkill,” I want to hammer home the significance of Volt’s insider activity, and as you can observe from the graphic shown below, it is not only the Chairman adding to positions. Several directors, as well as CEO Alex Wiley, have stepped up to take advantage of the recent weakness, and over my many decades of dodging the poisonous darts of the insidious TSX Venture Exchange, this is an extremely valuable tool and certainly must be heeded.

Whenever you get a stock guy (me) with several decades behind him discussing DLE technology with a veteran mine builder and engineer (Uhl), it can many times be a difficult interaction, but I have always gravitated to the technical people rather than the “pitchmen” because the validity of the “pitch” lies solely in the hands of the technicians.

Over the past forty-five years, I have encountered so much horse manure in the boardrooms of Bay and Granville Streets that I could fertilize the Canadian Prairies if I could ever have bottled it. This is why the actions of Warner Uhl spoke louder than anything on their website or in their power-point presentation. When phenomenal growth stories are disconnected from the market due to faulty assumptions, they represent truly unique opportunities once one is able to define the disconnect.

As I have now explained this “disconnect,” it explains why Volt Lithium Corp. is now my largest holding and why I am adding to the position from the grandkids’ education pool and Granny’s bingo money and since Granny will want that money back by Labor Day, I must be very confident.

Important Disclosures:

1. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Volt Lithium Corp.
2. Michael Ballanger: I, or members of my immediate household or family, own securities of: Volt Lithium Corp. I determined which companies would be included in this article based on my research and understanding of the sector.
3. Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
4.  This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.

For additional disclosures, please click here.

Michael Ballanger Disclosures

This letter makes no guarantee or warranty on the accuracy or completeness of the data provided. Nothing contained herein is intended or shall be deemed to be investment advice, implied or otherwise. This letter represents my views and replicates trades that I am making but nothing more than that. Always consult your registered advisor to assist you with your investments. I accept no liability for any loss arising from the use of the data contained on this letter. Options and junior mining stocks contain a high level of risk that may result in the loss of part or all invested capital and therefore are suitable for experienced and professional investors and traders only. One should be familiar with the risks involved in junior mining and options trading and we recommend consulting a financial adviser if you feel you do not understand the risks involved.