Stock Picks: Gold Turning Around – Newmont (NEM)

January 4, 2021, 1:43 pm EST

Gold Turning Around – Newmont (NEM)

Gold has a strong performance in the first half of 2020 (March – July) but under performing for the second half of 2020 (August – December). As we all know that gold is commonly used as a hedging position when stock markets are in decline process or risk-on mode. Or, gold keeps its value relatively stable when inflation becomes a threat. 

Well, maybe it is about the time for gold with a turn around the story.  

  • US dollar has been falling straight down since March 2020 for about 10 month. Gold is priced based on the dollar. So when all other conditions are constant, the falling US dollar should boost up gold price. 
  • Another companion metal, silver, is already on the rise since December 2020. Gold may follow up its upward momentum.
  • Top-out, intraday reversal, and breakdown today (DJIA -460 or -1,5%, S&P, Nasdaq -1.5%) could be the turnaround day
  • Technically, NEM made a gap-up breakout today as shown
  • Other gold stocks performs very strong also: AU +12%, GFI +14%, RGLD +4%, HMY +14%, NEM +5%
  • Entry point for NEM should be 63 with sell-stop 59
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