Gold and Silver Juniors, Mid-tiers and Producers Message Board

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Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers

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To: tyc:> who wrote (2338)	11/26/2005 12:34:34 PM
From: Claude Cormier	Read Replies (2) of 78417

- 1. Is it reasonable to measure the price of a gold miner in terms of gold ? Sure... it tells you if we are in a bull market or not. In a bull, stocks will outperform the metals. Try it with the $HUI. The last two years are in a downtrend. Then look at the last 5 years on a monthly chart Try it also on the big seniors ($XAU). The ratio is still well below the 17 years (200 months) average. Maybe we can conclude that this environment of rising operating and capital costs has restrain the advance of stocks. As oil and basic materials come down again, maybe gold stocks will be allowed to have a bull. Also remember that in real term, gold is still way below the high of $1996 at $414. A revealing ratio is the gold/CRB ratio. This one has been in a downtrend for 10 years. It is just breaking out this month after several attempts in the past 3 years. It looks like the bull in gold is finally being confirmed. The bull in gold stocks should follow. But we will be sure only after it happens. Many technical analysts are still calling for an approaching top.

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