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Gold broke its lower trend line on Tuesday and tumbled about $50USD/oz. The chart of this trend line break with a couple fib retracements can be seen here: [ Daily Gold Chart ] Gold is being punished because the Fed may finally raise interest rates in December? Of course it is all depedent on economic data between now and then.... Gold usually goes up as the US $ goes down because gold is valued in US dollars. People also flock to gold when there is global instability, times of uncertainty, and panic.
We have a US election coming and I think that could cause uncertainty. One guest on the Business News Network (BNN) stated that he thought gold would almost instantly rise $100US/oz if Trump won. We will see. Then there is the increased tensions between Russia and the US regarding the Syrian Civil war, NY Times Tuesday: "Tension With Russia Rises as U.S. Halts Syria Negotiations".
Gold may go up but with both the Nasdaq and Dow Jones indexes pushing higher, I wonder what event will be the catalyst for another 10-15% drop. The world situation makes me nervous.
The gold drop on Tuesday rippled over into gold and mining stocks. Investing in junior mining stocks is sometimes a very frustrating experience. Many of these stocks get pounded on this volatility because they are not heavily bid and PROS are in the market. All it takes is one or two investors with a bit of size to unload and down it goes.
You have to somehow value the company and ask yourself, "has anything changed?" Secondly if institutions are involved, they will say, "do I buy all this guy's stock at $2.80 or do pull my bids and buy it at $2.35".
I'm thinking there was some of this happening in Auryn ( AUG TSX-Venture ) stock on Tuesday. My original feature of Auryn was Feb 2nd, 2015 at $1.13CA. Since then it has a high of $4.17CA and closed yesterday at $2.79 up 14 cents. The big buyer yesterday was UBS with a net $203,228 worth of buying.
Auryn just got accepted to trade on the TSX. They also announced 60% of their drill results which featured:
"Auryn Resources Inc. has released partial results from its summer exploration program at the 300-kilometre-long Committee Bay gold project. Highlights include 13.71 metres of 1.91 grams per tonne (g/t) at the Anuri prospect and 23 metres of 2.5 g/t and 30 metres of 2.12 g/t from the Three Bluffs deposit. During the eight-week summer program, the company completed a major screening of the Committee Bay greenstone belt with approximately 10,000 metres of rotary air blast (RAB) drilling, 3,750 metres of diamond drilling at the Three Bluffs deposit, 5,500 regional till samples, 3,100 X-ray fluorescence till samples, 1,000 line kilometres of mapped boulders and 3,500 square kilometres of drone imagery over an eight-week field season covering an estimated 85 per cent of the belt."
A must see, 18 minute presentation by Ivan Bebek, Chairman of Auryn Resources:
[ Presentation ]
More results are coming from their summer exploration program and with their projects in Peru, they can explore all year round. This company is still one of my largest holdings. Do I wish I would have sold at $4.00 and bought back in on the dip, yes sir! The problem is that hindsight is 20/20.
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Remember, I'm an investor/trader like you. This is not investment advice, these are my opinions. Please consult your advisor before buying or selling anything.