Man, there is a buying opportunity coming like we haven’t seen in a long time.
Amazing finds will be on sale … buys that could double and triple your money — or more — over the next three years.
I’m talking about precious metals.
Now don’t buy them yet, because they’re in a correction. And despite the way gold rallied after the Fed’s much-anticipated rate hike yesterday, this could go on for a bit longer.
But the window of opportunity is about to open. And you want to be there when it does.
This buying opportunity will come as every babbling head on Wall Street is calling gold "dead as a doornail." They’ll miss the opportunity right in front of their faces. They tend to buy and sell at the wrong time. Every. Darned. Time.
Gold is cyclical. That’s a simple fact, one that the market pounds into our heads over the years. But let me show you what I mean in one of my favorite charts …
|Gold miners saw a six-year bear market (yellow), then a 6-year bull market (green), then a 1.5-year bear (yellow), then a 2.5-year bull (green), then a 4.5-year bear. Now we’re looking at a new gold bull market.|
This is a chart of the Philadelphia Gold and Silver Index, also known as the Gold Bugs Index. It’s a basket of leading precious metals miners. I’ve marked the bear markets in yellow, and the bull markets in green. These bull and bear trends become pretty obvious this way.
Why am I showing a chart of gold miners and not gold itself? Because miners are leveraged to the metal. That makes miners’ moves outsized — both up and down. I’ll have more on that juicy relationship in just a bit.
The last gold bear market ended in January 2016. We’ve had one year of bullish upside. There’s no magic length to any cycle. Those can vary. But solid research shows that gold bull markets tend to last between four and seven years.
And last year — wow! From January through early July, the price of gold soared 31.5%. It was fueled by a 2% rise in total global demand for gold, to a three-year high of 4,309 tons.
That demand, in turn, was fueled by the voracious appetites of physical gold ETFs. Some 532 metric tons flowed into gold ETFs last year. That is the second highest on record. Only the financial recovery in 2009 saw higher gold ETF demand.
But gold’s rally last year was interrupted by anticipation of rising interest rates and an investor focus on the U.S. election. Just as gold flowed into ETFs, it flowed out in the second half of the year — to the tune of 193 tons. As a result, gold ended the year up only 9%.
And this year — so far — we’ve seen the correction to gold’s new trend continue. So far. Not for much longer. Not if the cycles, and massive global megatrends I’m watching, have anything to say about it.
Along with a heaping helping of central bank financial flim-flammery at its finest …
Oh yeah, that’s gonna add some juice to gold’s move, too.
So let me show you another chart.
This chart looks different because it’s the metal, not the miners. And this chart is "only" since 2007. You can see that gold is near support from its big uptrend.
I call it the "Uptrend of BOOM!"
So here’s my million-dollar question for you: "Would you rather buy something when it’s cheap or expensive?"
Right now, gold has a huge discount sign on it. And gold miners — cheap? I’ll say they’re cheap! They got pounded into the dirt.
There are a good dozen producing gold miners trading for less than book value right now. These are functioning gold mines. They dish up real money. They’re priced like the CEO is on fire and falling down the shaft.
Yeah, that’s a discount. Even with the rally off the lows at the beginning of last year, many miners are still dirt-cheap.
But cheap can get cheaper. I don’t think we’ve hit the bottom yet. I will let you know when we do.
What’s more, I just came back from the Prospectors & Developers Association of Canada (PDAC) conference in Toronto. That’s the world’s biggest mining conference.
That’s the conference where miners, developers and explorers who drilled and scratched for the shiny yellow stuff all year come in to talk about their best drill results and their most prospective finds.
You can bet I came away with some ideas on how I want to play this next boom in gold and silver. With stocks that can double or triple your money — or more. Maybe a heck of a lot more.
Now some wobbly sorts will clutch at their pearls and say, "But the Fed! The Fed is going to keep raising rates!"
Well, you can see that the Fed’s rate hike on Wednesday didn’t slow gold down. I don’t think the hikes the market is already anticipating later this year will hurt gold, either.
Let me show you one final chart. We’ll call it "the nail in the coffin" for gold bears. It’s a chart of what happened during the last Fed rate hike cycle.
In June 2004, the Fed benchmark rate was at 1%. By mid-2006, it was at 5.25%. Meanwhile, gold went from $383.60 per ounce to $721.50 per ounce.
That was a nice 88% move in the metal. What do you think happened to miners? They soared, many by triple-digit percentages! And the big move in miners wasn’t over. After some zig-zagging, they took off again. The gold bull run didn’t stop until 2008.
I know. I was there. I was there the day my then-boss Larry Edelson looked at gold charts and flipped his outlook from bearish to bullish. And man, that was a whole new ball game.
So here we are again. The cycles come around. The new bull market has started. Maybe you didn’t believe the initial rally. After a grueling, 4.5-year-long bear market, I don’t blame you.
But now you have a gift. Like heaven is reaching down and handing you a box tied up with a silver bow. This pullback. This pullback is that gift.
How much will gold go up in this big bull cycle? My intermediate working target is $1,519. But longer term, I don’t know. Just like I don’t know just how deep this correction will go, or the exact date that this correction will end. The day that the gold bulls snort and roar and charge higher again.
But I’ll know it when I see it. And I’ll be ready. You should be ready, too.
All the best,