Tuesday 31 December 2019

Powerful year for the miners

The gold miner ETF of GDX ended the month on a weak note, settling -0.7% at $29.28, but that still made for a net monthly gain of +8.9%, and an annual gain of +39.8%. The m/t outlook is bullish with gold and silver.

GDX monthly

GDX daily


GDX broke a new multi-month high on New Years eve of $29.76, but did see some cooling to settle moderately lower. Regardless, it was both a bullish month and year.

Soft target is the 2016 high of $31.06. Any price action >32.00 would be decisive, and offer secondary of psy'50/52s. The latter looks realistic in the second half of 2020, not least if Gold >$1750 and Silver >$21s.

Lets take a look at the two biggest components of GDX...

Newmont Goldcorp (NEM)

Newmont saw a very powerful net December gain of $5.19 (13.5%) to $43.45, which made for a net 2019 gain of 30.5%. With the 2016 high taken out, it opens the door to next target of psy'50/51 zone.

Barrick Gold (GOLD)

Barrick Gold saw a net December gain of $1.79 (10.6%) to $18.59, which made for a net 2019 gain of +38.4%. We have a provisional confirmation of multi-month price structure of a bull flag. Soft target is the 2016 high of $22.71.

Of the two, yours truly favours GOLD, but both trade together pretty closely.

Valid alts: AU, AEM, FNV, and WPM
Specific Silver miners: PAAS, HL, AG, CDE, KL, KGC

For the record, yours truly sees the previous metals and related miners, as the most obvious (and straight forward) trade for 2020.