Gold and its miners’ stocks are rocketing higher as speculators and investors alike return to this left-for-dead sector. This sudden deluge of capital inflows has crowned gold stocks the best-performing sector of this young new year by far, shocking traders. And this stunning reversal of fortunes in both the metal and the companies producing it is only starting, so it’s exceedingly important to understand what’s going on.
Gold was inarguably the world’s most-hated investment in recent years. No one wanted anything to do with it, because no one felt any need for it. The world’s stock markets were relentlessly levitating, thanks to record easing by the world’s elite central banks. And with stocks seemingly destined to do nothing but rally indefinitely, there was little demand for counter-moving gold for prudent portfolio diversification.
But as global stock markets started sliding in 2016, the bubble in central-bank confidence rapidly started to burst. Central banks indeed quickly stepped in to try and stave off the waves of selling, but to no avail. Extreme central-bank jawboning and actions that would’ve dramatically goosed stocks in years past failed to have much impact, helping shake traders awake from their years-long central-bank-induced stupor.
These newly-alert traders started remembering that markets are forever cyclical, they can’t move in a straight line forever. What’s high and in favor after rallying for years will inevitably roll over and head the other way, a bearish portent for central-bank-levitated stocks. Conversely what’s low and out of favor after years of selling will inevitably mean revert higher. Thus investment demand for gold is rekindling.
The dazzling 2016 gold story truly is that simple. Stock markets are rolling over into a long-overdue new cyclical bear that central banks artificially held at bay for years. So investors are diversifying into gold, which generally moves counter to stocks. And with investors migrating back, speculators are flocking in as well to ride gold’s momentum. With this strategic context in place, let’s dig into what’s been moving gold.
who is a non exe director here has just been made chairman of FRI and are going to stop all oil explorations etc. They will then having just reissued loads of shares, going to have to either start getting in a partner for their block 38 in the Oman (unlikely) or Should the Block 38 EPSA terminate, then in accordance with AIM Rule 15, the effect would be that the Company will cease to own, control or conduct all, or substantially all, of its existing trading business, activities or assets and would therefore become an AIM Rule 15 cash shell, pursuant to which it must make an acquisition or acquisitions which constitutes a reverse takeover under AIM Rule 14 within six months, failing which the Exchange will suspend trading in the Company's shares pursuant to AIM Rule 40.
Could he make a bid for Gold instead of oil and make an interest in here? possible as both have gone up today? Might be nothing but worth looking into.
Thanks harry - I was missing your s/p bulletin's - big volume today, could be the build up to the announcement of the project our new CEO has been looking for and jibbers 3D model of Mutsk - either way looking good.
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