There were no S&P 500 earnings reactions on Monday, but have you seen what's happening in precious metals?
We’re coming to you from Toronto this week for the Portfolio Accelerator event - the unofficial Gold Bug capital of the world.
Just a two-minute walk from our hotel is Agnico Eagle Mines’ headquarters, a fitting reminder that this city is home to Canada’s largest Gold miner and the second-largest in the world. If you want a pulse on the gold space, you couldn’t pick a better neighborhood.
Right now, the moods are good around here...
Gold miners are benefiting directly from the surge in precious metal prices. With Gold prices rising and Silver following suit, miners are seeing their leverage to metals pay off in real time.
When the underlying commodity price rises, best-in-class operators like Agnico stand to benefit the most.
The charts tell the story best:
After decades of carving out an accumulation pattern, Agnico Eagle Mines broke out to new all-time highs earlier this year. This is the type of structural breakout technicians wait for over entire cycles. Once these kinds of bases resolve, they tend to fuel powerful, sustained advances.
That's exactly what we've seen... The stock has rallied for eight consecutive months, and it appears that September will make it nine months in a row.
On a relative basis, AEM is on the cusp of resolving a massive base relative to the shiny yellow metal. New highs in the relative trend would confirm the new highs in the absolute trend.
Agnico Eagle Mines is high and tight:
On the daily chart, the story is just as bullish. A few weeks back, Agnico Eagle Mines was rewarded for a double beat, ending a four-quarter streak of negative post-earnings reactions.
That fundamental catalyst was the spark that launched the breakout. Since then, the stock has continued to move steadily higher.
Now price action has tightened up into a high-and-tight continuation pattern, one of the most bullish consolidations we look for. That setup suggests another leg higher could be imminent.
In other words, investors are getting a tactical entry point that aligns perfectly with a long-term breakout and a strong intermediate-term uptrend. It doesn’t get much cleaner than that.
So here we are, standing in the Gold Bug capital, watching Canada’s largest miner print fresh all-time highs.
Up here, it's clear that we're in a global Gold Rush.
Happy fishing
-The Beat Team
P.S. Are you looking to profit from the Gold Rush in stocks like AEM? Each week, All Star Charts Gold Rush covers the mining industry and more. In their latest report, Sam and Jason outlined six new trade ideas.
