Nice early retest of horizontal support, page-12

loki, you seem to make this same call every year for lower gold prices. For the most part you have been right and gold and gold mining stocks have tended to decline from March onwards (except in 2016). At the same time I think you yourself have said you are often too bearish when the gold market turns up.

I'd also note that this is one of the first major sell-off days of the year and you're immediately calling DCN to $2. The GDX was down less than 2% on Friday night so I don't think there is a lot evidence yet to say this is a medium term trend change in the gold market.

I think the difference this year is the Fed. The Fed's buckling to the stock market panic in December has been truly epic. The rate hiking cycle went from 2 or 3 hikes in 2019 to being over in the space of less than a month. In fact this feels very much like 2016 except that economic indicators worldwide are tanking harder and the US market is trading at 40% higher levels. Then you have Trump saying the dollar is too high and interest rates are too high. He is also questioning the Fed doing QT.

“Essentially there’s no inflation,” Trump said.

“Can you imagine if we left interest rates where they were, if we didn’t do quantitative tightening. Taking money out of the market if we didn’t do quantitative talk, and this would lead to a little bit lower dollar,” he said.

My feeling is that the zeitgeist has changed in the gold market due to the Fed's action in December. In other words, I believe December is a longer term turning point and not just a seasonal upswing.

There's also the fact that DCN should produce record numbers over the next 6 months that firmly value it as a producer, and I think rerate the stock to a mid-cap producer. The production trends appear very positive and I think support that outcome.