Why Are the Gold Miners Lagging?
May 27, 2017
Gold is currently at the top of its range, and a lousy place for new money, but there are a few things which need to be explained. In uptrends (and downtrends) there are times when we see relative strength differences between the miners, gold, and silver. It’s basically just a race, leaders and laggards at different times. To me it’s most concerning when it’s gold which is lagging. If the miners are lagging, that says more about the miners. I treat each one separately much of the time. There are times to be short the miners, but still neutral on gold. Even currently, look what the junior miners have done, and look at gold. Gold stocks are “gold” and “stocks”. Gold is gold. In the bigger selling waves in gold, the miners are going down also. Right before the election on November 1, 2016, this post explained why I was very concerned about gold, and would use trading above $1305 to sell/short. This was when the gold bugs were going crazy about how the election would cause gold to “soar”. It didn’t matter to me who got elected, gold was bearish, hence the miners. Conversely this post on December 9, 2015 explained why it was finally time to buy gold, and especially the miners. And recently, on a trading basis, it was time to sell, then short the miners in early April, and even shorter term basis, buy miners on 5/24. I will continue to focus mainly on gold.