Key points:
- More than 40% of gold mining stocks have reached 52-week highs
- Few of the stocks are now in corrections or bear markets, a stark change from a few months ago
- Similar cycles in this sector over the past 30 years had a good record of further gains over the next few months
Miners see more and more blue skies
A little over a month ago, we examined the surge in gold mining stocks. About a third of them had reached 52-week highs, a concerted push with an inauspicious record in this sector. If buyers continued to show interest, it would tell us quite a bit about their longer-term prospects.
And interest they have shown. Miners dipped for a couple of weeks after that, but buyers saw that as an opportunity, which is rare for this particular sector. As a result, more than 40% of mining stocks hit a 52-week high last week. This was the first reading over 40% in over a year, and the last couple of instances marked the nascent stages of impressive rallies. |