I must admit that had me perplexed the last few days.
Had me wondering if there was some bad news in the wings, waiting to be released. Bought more yesterday, should have been more patient
The monthly close was yesterday. Both gold and silver are right at their 48 month MA (4 year MA). As you can see, the POG and POS only occasionally cross this long time scale average. Both are right at the boundary threatening to move higher.
They will apparently have to fight another Fed rate hike in March, which should make the dollar even stronger. So any move higher will have to bear that additional burden.
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Here’s my simple daily interval chart for silver. Simply put, we’re looking for a test of the 200 moving avg. here which is the green line just below 18.20. The red 20 exponential moving average is sloping upward nicely and right at $18.
Should silver pull back lower than the two MA’s mentioned above, keep an eye on the blue 50 weekly MA and the red 20 EMA, at 17.92 and 17.66 respectively. (Keep in mind I’m using my clumsy broker charting and therefore can’t offer as much input as I used to with the professional software I used to run).
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Here’s the weekly interval chart for gold. You can see gold moved up and tested the bottom of the 50 week moving avg. (blue) and is now looking to test the top of the red 20 EMA @ 1226.80. Just below is the white 130 weekly MA @ 1218.40.
On the daily interval chart, gold so far pulled back to exactly test the red 20 EMA at 1237.20 and has moved thus far today back up to the white 130 MA at 1241.60. The close today and for these next couple weeks on this chart will be revealing in regards to the strength of gold.
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I’ll put up some charts for MUX and PAAS when I have time.
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MUX chart is looking ugly right now. They have a conference calll tomorrow to discuss financial results for 2016 and project developments.
The miners in general are trending down. I would say that the realization has set in that even at current metals prices you need really good grades to make money. Many even very good companies are still just above break even. Markets move so fast now days with all the machine trading I think the expectation that the miners would be making tons of money now just got way ahead of reality. And now with some modest uptick in inflation, e.g. higher oil / energy prices, the costs for miners are rising again as opposed to when oil / fuel was rapidly dropping. That is going to eat into future profits.
Bottom line is fuel prices need to show they are not going up too rapidly and metals prices need to go higher for more miners to really be making serious money.
The daily MUX chart is ugly for sure, although the weekly interval isn’t looking so terrible… at least so far. At this time it is holding its 50 weekly MA. On this chart the next places for support to watch are at the top of the downtrend line, currently at $3, and the 200 and 130 weekly MA’s at around 2.17 and 2.05 respectively. There are some higher support areas I’ll show on the next chart.
This is the MUX daily interval chart. It has dropped below all of the major MA’s on this chart so for now it looks bad, but there are some decent support areas in the form of the white horizontal lines and an uptrend line. You can see that MUX has already lost the 3.50 support but so far today has bounced off the horizontal line at 3.23. Next is the uptrend line support now above $3. The final horizontal line I’ve drawn for now is at 2.95, but you can see that there could be one drawn at 2.69. As you can see by the current candle on this chart, there has been some late morning buying off of the 3.23 support line. There’s a lot of resistance to get through on this chart if it pushes higher, and it all resides in a narrow price range between 3.47 and 3.68.
Anyone keeping an eye on FCX? Could get very interesting in the next three months over the Grasberg mining situation.
An excerpt from a recent article:
UPDATE 2-Shareholders tell miner Freeport to get tough with Indonesia
MARKET NEWS - Mon Feb 27, 2017
By Nicole Mordant
He said Freeport had held talks with large shareholders but did not name them. Freeport’s third-biggest shareholder is activist investor Carl Icahn, who holds around 7 percent of its shares. Icahn has been appointed a special adviser to U.S. President Donald Trump.
Freeport, the world’s biggest publicly listed copper producer, warned last week it could take the Indonesian government to arbitration and seek damages over a contractual dispute that has halted operations and exports at Grasberg, the world’s second-biggest copper mine.
The dispute, which centers around the sanctity of Freeport’s 30-year mining contract, comes as the Indonesian government seeks to squeeze more revenue out of the mining industry by shaking up regulations over foreign ownership and ore processing.
http://www.reuters.com/article/mining-bmo-freeport-mcmoran-idUSL2N1GC0KF
Also read:
Freeport sees ‘no return to business as usual’ at Grasberg mine -document
By Fergus Jensen
JAKARTA, March 1 (Reuters)
In the memo, Freeport said that over the past month it has revised its operating plans, slowed its underground expansion and announced “drastic reductions” to manpower levels in efforts to cut costs.
“These are painful but necessary measures the company needs to survive while it works with the government to achieve a mutually acceptable solution to resume exporting copper concentrate,” it said.
"The outcome of our negotiations with the government will not change this. There is no returning to ‘business as usual,’"it said. The changes represented “a fundamental shift” in how Freeport operates, it said.
Production of copper concentrate has yet to resume at Grasberg as a result of the export stoppage, a company source with direct knowledge of the matter told Reuters.
Indonesia’s director general of coal and minerals, Bambang Gatot, declined to comment on the changes in output. The government often met Freeport to discuss its mining rights “but there has been no conclusion yet,” Gatot said.
Indonesian President Joko Widodo said on Thursday that the government was seeking a solution to the Freeport issues that benefited both parties.
Freeport CEO Adkerson said on Monday that he hoped and believed the dispute will be resolved, “but we have to plan for it not being resolved, and we’re doing that.”
“This is not a sweetheart contract for Freeport,” he said, referring to $16.5 billion in taxes, royalties and dividends Indonesia has received from Freeport since it signed its mining contract in 1991, while the company has taken $10.8 billion.
“We’re all going to win together, or we’re all going to lose together, and I believe that’s going to be the dynamics that bring us to the table and reach a mutual agreement,” he said.
Freeport sees 'no return to business as usual' at Grasberg mine -document
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Thanks Rich. It looks like it is trading in a fairly symmetrical upwards channel. I might add to my position off the lower trend line around $3.05 if it falls to that level.
Annual Report is now out:
MUX: McEwen Mining Inc. SEC Filing - Annual Report (10-K) March 1, 2017
http://www.nasdaq.com/symbol/mux/sec-filings
see pg 39 10K:
Selected Consolidated Financial and Operating Results
MUX, PAAS, and gold futures all had a strong closing today with silver not looking bad either. I’ll post updates over the weekend barring anything significant occurring before that.
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Here’s the FNV charts as requested easymillion…
The weekly interval shows from August '16 a decline from $81 down to almost $53 in December/January where it tested the weekly 130 MA and didn’t quite make it to the 200 MA. In mid-January it rose up through its 20 weekly EMA, tested the 50 and broke through it for a couple weeks before losing that support. This week it failed to move back up through the 50 and thus far is failing to hold support at the 20 EMA. There is still trading left in the week for a close above the 20, but so far it’s not looking likely, especially with the candle opening below the 20 EMA. I would watch to see if there’s support found at 61.75 on a move lower. If there isn’t, I’m inclined to think it will retest the 130 MA right around $56.
Yesterday the FNV daily chart showed some buyers coming into the stock in an attempt to hold the 50 MA. The stock gapped down at the open today, the bright side being that the price opened above the 50 MA so perhaps there will be a rally and close above the 50 again today. Unfortunately thus far today is looking like the making of a bear flag so I’m expecting the stock to see that 61.75/.50 level.
Thanks for posting, Rich - appreciated.
Primarily a streaming company, I found yesterday’s Bloomberg article quoting FNV’s CEO of interest. It is expected miners will be looking for financing to build the next wave of mines:
“After a downturn that squeezed capital investments, most gold producers have no choice but to invest in new projects as existing mines are depleted, Harquail said Wednesday in an interview.”
by Danielle Bochove
March 1, 2017, 2:38 PM MST March 2, 2017, 8:36 AM MST
https://www.bloomberg.com/news/articles/2017-03-01/gold-miners-running-to-stand-still-after-cuts-franco-ceo-says
The following statement was of particular interest:
As a result, Harquail said Franco-Nevada plans to do more deals in the non-precious metals space, with a particular focus on oil and gas. The company’s mandate allows it to have as much as a fifth of its portfolio outside precious metals, and he would like to deploy capital to get to that level soon. Currently 94 percent of Franco-Nevada’s holdings are in precious metals, he said.
Also of note, FNV has a 0.22 dividend payable on March 30 - Ex-Dividend Date Mar 14
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I know this is not a mining stock, but did anybody get in on SNAP?
Nah. Those IPO’s can be tricky (see Facebook) and for a chartist like me there’s no data to trade off of until it’s been trading for a few months. I suppose in this market though a buy and hold mentality can do very well.
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I found this interesting. FWIW Interesting to see what Provinces and States were attractive too
O Canada: Top Mining Nation In The World - Fraser Institute | Kitco News