Hi Guys,
This weekend I have been assessing my holdings and looking to add some more to participate what I think is the most exciting times for gold bulls which most likely could be this month.
I really don't know what the FED will do, we can only speculate. I don't even exactly know what would be the reaction from the gold market if they or if they don't raise rates. But my money is on they won't raise rates.
So if that is what will happen it could be an explosive move for gold & silver, like the Brexit moment. Gold will likely break through its long term downtrend from 2011. As time passess the slope is falling which could be likely around 1350-1360 region now.
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That upper blue line is one formidable resistance to overcome. Last six weeks gold has failed to overcome each and everytime. The shorts come out in full force to defend that line, inducing participants to sell.
Once gold breaches that upper blue line decisively, 1400 is on cards. It will most likely happen this month.
Almost no one is talking about the inclusion of Chinese Yuan in the IMF SDR basket. There will be volatility in the Forex Exchange market during that period. All the 4 currencies ( USD, Pound, Euro & Yen) are going to lose some share to give way to the Yuan.
My belief is a lot of wholesale money is sitting in the sidelines, watching what gold will do. And if gold breaks that tough resistance it will draw buyers from all around. That break will be decisive like the Brexit event when everyone before that were thinking whether gold will manage to break 1300. It did on that day decisively and since then tested twice that level. Buyers pop up at 1300 level everytime.
Anyway, my point is to identify which company will benefit the most. After a good assessment I have worked out two companies in my portfolio which could have a decent run. As you guys know I rarely talk about other company in another company's thread/forum. One of them is BDR, and most likely the top contender to take advantage. Reason's I believe are
1 Completely unhedged( Most companies have hedged 30-50% or more of their production at least in my portfolio)
2 Strong production expectations ( 100k ounces from July to Dec, resulting to
3 Low cost of production( USD 750-USD 815)
4 Continuous Drilling to add Resource & Reserves
5 Top 20 holding 720-750 Million shares( 70-72 % of the company), that would be the biggest buy signal anyone can think about. It's a hell lot of confidence from the top 20. I'm sure there are many people in the hotcopper forum who own a decent amount of shares, some probably in millions.
6 Last but not the least the story of company operations turnaround to be proven, so far it is all plans & promises. Although improving, results are yet to be seen.
So here is some thoughts from me. In the case of September failing to reach my expectations, I will most likely re-think my whole conviction staying super long in the Gold Market.
One more thing we all can sleep well tonight as their is no possibility of NY smackdown as US is closed for Labor Day Holiday.
All the best.
