After five years of a brutal bear market, gold and gold miners are finally having a huge rebound, and investor Chen Lin, writer of the popular newsletter What is Chen Buying? What is Chen Selling?, sees the parallels to 2009. He highlights nearly a dozen mining companies that have weathered the downturn and are in position to ride the wave higher.
Gold and gold miners are finally having a huge rebound after five years of a brutal bear market, and we are having a spectacular year so far. Recently gold and silver are shaking off the potential summer weakness. We have been seeing very weak physical demand from China and India in the past few months due to high prices: Chinese demand was down 30–40% and India’s was down 70–80% in Q2 versus the same period last year. In the meantime we have some Federal Reserve officials signaling that more interest rate hikes are coming up.
“Pretium Resources Inc. is finishing up a world-class mine in northern British Columbia.”
However, gold and silver are still looking very strong in the shoulder month of August. This year’s gold and silver rebound tracks the strong rebound of 2009, the period when gold and silver rebounded off the brutal 2008 crash. Following the 2009 playbook, we should have a good second half if gold and silver continue to follow in the footsteps of 2009. As you can see from the charts, gold started to take off big time after the summer consolidation in 2009, first at the end of August and early September, exploded parabolically, and peaked in early December. If you look at the monthly gains of 2009, two-thirds of the annual gains happened during the three-month period of September, October and November!
Seasonally, gold and silver usually …read more