TheDailyGold: Potential Upside in Juniors in First 6 Months?

Apr 15, 2020

Good morning to you.

What took place over a year during 2008-2009 has basically occurred in only 7 weeks this time around. I am talking about the crash in precious metals, the false breakdown and now the impending breakout in GDX.

Anyway, GDX tested multi-year resistance on Tuesday and sold off. If and when it breaks above this 7-year base, look out. Gold is approaching multi-year resistance at $1800. So, these are levels at which the vertical rebound could pause or even correct.

In Episode #14 of the 10-Bagger Podcast, I chatted with David Erfle and he shared his insight on the current situation, comparison to 2008 and what to look for to find 10-bagger potential.

Back to rebounds and corrections…

In a recent flash update I analyzed the corrections during the vicious rebounds in juniors following the lows in 2001, 2008 and 2016.

GDXJ has actually had two sharp but swift corrections since the mid march low. That is most inline with 2008. The next 3 corrections (post 2008 low) averaged 15% (over the next few months).

In 2016, GDXJ only corrected 17% and 11%. It was an amazing, vertical rebound. That’s quite similar to what happened after the secondary low in late 2001.

Here is the most important point…

From these three major lows, juniors rebounded on average 200% in the first 6 months. The corrections tend to be swift and then the uptrend resumes. You have to pounce on weakness.

GDX has a huge bullish base and GDXJ is not too far behind. The fundamentals are even stronger than they were two months ago. And what happens if Gold breaks $1900?

Then we could get a repeat of what happened in 2001-2003 and 2008-2011 in the best juniors. My index had them rising ~14x in 2.5 years. (For comparison, GDXJ did 7x from 2008-2011).

I have seen and tried a few of the news letters. Yours is by far the best, yours is the only one that really gets the technical analysis down. Fundamentally I really like your picks they are all low risk minimal downside with huge upside. I have found some of the other news letters pick a lot of risky exploration stocks or they simply have far too many companies. You seem to sift through the best and recommend a simple more condensed list with big upside.

I’ve been reading JRB for over 12 years and a subscriber for 2 years. Excellent, outstanding honest service, best investment newsletter I’ve ever made (and I’ve been through many). My only regret is not being more patient and listening to JRB more closely!

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Moving onto TheDailyGold Premium…

I have a list of my top 8, top 11 and top 17 stocks. I’m trying to build a basket of 10-12 that focuses a bit more on potential upside and can replicate that 14x move.

Some of my top 17 are too high quality to fit in that basket. They won’t be 10-baggers. But they could still be 5 baggers if Gold surges past $2,000/oz.

My goal is to buy and hold this cycle. Trim big winners, cut the losers, add to positions on weakness.

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“I am simply a pure market-timer for a broad basket of gold stocks and precious metals. Jordan, on the other hand, has provided superior STOCK-PICKING abilities over the longer-term. I am familiar with most gold stock subscription services over the past 30 years. I rarely provide endorsements of any kind, but Jordan’s ability to analyze individual gold/silver stocks has been among the top 5 services over the past decade. First and foremost, I respect his integrity.
-Jeffrey Kern, SkiGoldStocks.com

Thanks for reading. I wish you all great health and prosperity!
-Jordan

Disclaimer: This newsletter is intended for informational and educational purposes only and should not be considered personalized and individualized investment advice. Investment in the precious metals sector contains significant risks. You should consult with an investment advisor and do your own due diligence before making any investment decisions. This email may contain certain forward looking statements which are subject to risks, uncertainties and a multitude of factors that can cause results and outcomes to differ materially from those discussed herein.