Nick Hodge: Gold to Remain Bullish, Watch Silver, Copper and Uranium Too

Nick Hodge: Gold to Remain Bullish, Watch Silver, Copper and Uranium Too

[Music] I’m Charlotte M cloud with investing news.com and here today with me is Nick hodj publisher at digest publishing thank you so much for being here great to have you Charlotte it’s always good to be with you in Top Shop how are you I am very well and excited to be catching up with you from our last conversation which as we were talking about before we turned the camera on was about 5 months ago so toward the end of 2023 and definitely so much has happened when it comes to Gold so I’m thinking we should start with gold today and check in with you there so the price of course has been hitting record highs although we’ve seen a pullback more recently so what main drivers are you looking at right now for gold yeah time seems to um see seemingly fly by 5 months ago we were talking about gold just starting to hit a 2000 and as you just mentioned there it’s gone on to hit record prices in the five months since but you know even as recently as February it was just putting in a monthly close at 2000 and then in the past two months March and April it you know sort of jumped up to above 2200 and 2300 so that’s a good place to start answering your question is that you know it’s starting gold is starting to check technical Milestones right it’s closing months above 2000 it’s closing months above and quarters now in fact at the end of March um above 21 and 2200 and so um it’s checking technical boxes that tell broader more generalist investors that gold is emerging from a bare market and it starts to you know beget or attract Capital simply because it’s going up attracting you know additional funds and momentum and swing Traders for example so that’s one reason the other reason is is in the headlines a fair amount and that’s um the ongoing conflicts in in the Ukraine and um Israel and Gaza of course and then um a bit more monetary driver is is buying that’s been coming as a result of that geopolitical tension so um you know in April we had some retaliation from Iran for example launching those drones ahead of that is when we saw some really big Days of Gold pying um when people were wondering where that buying was come from um you know people who follow such things as you know the the exchanges and things were saying it was and coming through typical routes like London was more Eastern buying so I think all these things are sort of known now that um there was Middle Eastern buying there’s been increasing Chinese retail buying for example so those are the things that are driving gold you know what maybe perhaps more interesting to me is that you know gold continues to ascend and and hold its bullishness and price despite other things that are going on in the market I’m talking about continued High rates continued strength in the dollar and so all those things that we just mentioned are driving gold yes but um gold is really telling you in its own way through its own signal that it is bullish and is going to remain bullish and then um I don’t know if you wanted to get into the stocks but the last time you and I talked I was saying that um we were talking about what hasn’t worked and I was saying gold stocks haven’t worked they they haven’t caught up or or shown their leverage to the gold price and that’s starting to change just here over the past one to three months you see you know GDX and gdxj starting to um hit better technical level and then you have you know companies starting to report like numad recently that are showing that these higher gold prices are starting to trickle down to the bottom line and that again attracts investors who are either new to gold or haven’t been paying attention to gold and gold stocks yes I think definitely I want to talk about the gold stocks and I’ll I’ll go there in just a moment I think before we do that I’ll ask you a couple of follow-up questions on what’s going on with gold right now one point that you mentioned which is is pretty interesting is some of those elements that you would think would be headwinds for gold actually don’t really seem to be a headwind right now so you mentioned the high interest rates and I know maybe not in our last conversation but in previous conversations we had talked about how gold was waiting for the FED to to turn around and take rates lower and that might be a catalyst and I I’ve heard that from lots of different people in the past but has the fend then become kind of less important for gold at this point yeah that’s good phrasing the the last monthly issue I wrote about the macr market markets was about you know tuning the FED out and you know the fed’s sort of been all over the place in December they said they were going to cut rates three times this year if you remember and then um the calendar turned to 2024 and Jerome went on 60 Minutes and was saying that we’re going to be cautious and um you know don’t expect cuts too soon you know inflation is starting to reinl so yeah for sure um I think the market in general and and gold specifically has begun to to tune out the the fed’s noise the fed’s gisness I’ve called it in um recent podcasts and and stuff I’ve done um at the same time you have growth so growth is what’s changed uh to get back on track I was telling you back in October that inflation was going to be higher for longer that rates likely would be higher for longer I used that specific ter higher for longer and now I see that in my inbox every day here in in April 2024 heading into May so that is what’s happened higher for longer what’s different and what’s changed and what I got wrong was the recession expectations so I was talking a lot about recession that that never materialized and we can talk about why but we don’t have to what happened is there was um good GDP growth in the US in in Q3 and Q4 um you know up around 3 4% and then that has slowed down but it’s not gone negative so you need negative growth for a recession that hasn’t happened instead you’ve got slowing in growth I think the number was 1.6% just came out recently for the q1 2024 for the US um and so in that respect we just talked about inflation higher for longer rates higher for longer but slowing growth I mean that’s the quintessential defin definition of stagflation right which you’re probably starting to see out there more and more and so that’s one of the reasons that that gold has been able to defy um you know those higher rates that that are typically um you know push gold lower that it has an inverse correlation to at the same time other currencies have weakened so um you know the Yen has been extremely weak against the dollar and so those are sort of and the dollar has been strong but but gold has again providing its own signal that it’s bullish right and I definitely have been seeing those stagflation headlines start to proliferate I think toward the end of last week so that seems like something to keep an eye on for for the gold price I think people are wondering how high can it go in 2024 so I wonder if you have thoughts there I’m also curious you know how low could we go because we are kind of in this this correcting time at least for the moment yeah so how let’s do higher first I meany you sort of seen how wide the candles can go I mean you had days on gold where was adding you know 40 50 bucks and more in a single day climbing above you know 2400 at one point before I’m starting to consolidate so I think 2450 to to 2500 is a good near-term Target for gold sort of three to six months definitely time to be buying weakness down to around 2300 um so now I think you have sort of supported in the 2300 area and I’d be concerned if if it dip below that if it does if it does break down below 2300 you ask about downside and now I think what was previous psychological you know resistance at that 2,000 level becomes your support that’s typically how markets work so supported 2,000 uh but again you’d have to break down below 2300 to to bring those lower numbers into play okay okay and let’s let’s move over and take a look at the Gold stocks so as you mentioned the last time we talked you had mentioned they were not working relative to the gold price at that time so now it looks like that is starting to change so maybe you can go into what you’re seeing there why it’s starting to change and and whether that may accelerate and pick up some steam sure so um you had inflationary pressures that were Weighing on the producers for the past couple of years I mean you had inflation that was at 9% in in recent memory so um that was in some of the things that are input costs for miners you know Diesel and and commodity input so first they had that that cost inflation that sort of compressed their margins and so they weren’t returning metrics that attract broader investors on a you know a cash flow basis a PE basis Etc um you know in the past two years as as gold has gone above 2,000 and now at record prices that we’ve talked about you’re starting to see the the attractiveness of of mining reflected in the the earnings and the balance sheet of these companies that are reporting um most recently numont who is showing you know an increase in cash cash flows that their costs they’re all in you know sustaining costs are still up there around 1,400 or you know even a bit higher than 1400 but that’s different when gold is trading at 23 and 2400 it allows you know more of those profits to fall to the bottom line at the same time inflation does remain sticky high but it’s come down from that you know six seven 8 % and is a more manageable at three or four% so you don’t have those costs as high and so um you know that’s I I think just given a signal for for broader investors to come in people like to talk about mergers and Acquisitions we haven’t seen a ton of that in the gold space there’s been some um smaller things going on but I think what’s happening is that um going back to those technical IND indicators of gold you know now being firmly in a gold market gold bull market excuse me you know I think investors just expect that the gold stocks come come next and that’s what we’re seeing so you do have the G GDX and gdxj that that are bullish now and um you know I think buying gets buying it doesn’t have to be necessarily more complex than that right and I think it would probably be helpful to hear how you’re approaching the gold stocks right now and you can talk about that from a br perspective or if there are specific companies you want to mention that would also be great yeah so I should always just lead what telling you that I do two things right I manage long-term safe capital and in you know retirement accounts and then I I I speculate as well either in the open market or or via private placements so um you know on the quote unquote safer side we we still have a a good chunk of capital in Gold itself a gold trust or you know a gold back position that we use as the anchor of our um you know gold Investments and then on top of that we have gdxj so gosh in amounts of capital but the two of those things are probably between 10 and 14% of capital just those two positions so um that serves as as the the Bedrock of our gold positions then we take shots at you know producing companies in in that letter that are producing and and generating cash flow for example um on the more speculative side what we’ve done is and what I told you we were going to do back in October is we were buying companies that were developing assets that were cashed up that that didn’t have to raise money Artemis gold has been one of those companies it’s it’s continued to do well going from five or six bucks a couple of months ago to to eight today um and just looking at those companies that have liquidity and that don’t need to raise cash I’ll preach the same thing I was saying then is um despite gold stocks having turned bullish and starting to outperform gold in the past one to three months they’ve still been um debased for a long time and they would still have a lot further upside to go I should mention that silver has not reached alltime highs fertile hunting grounds there as well um but you have still have time and you have the ability to be selected um again choosing companies that have already done feasibility studies that have already proven themselves and that and that have good management teams so um that’s where I continue to hunt and then even further down the value chain um in the Explorers it’s sort of the same story that those companies that have catalysts in the next three to six months and that they’ll need to raise money to to make those catalysts come to fruition so sort of my criteria doesn’t change just the the when we’re doing it based on what’s going on in macro markets does so um I try to be consist Ed in that way okay great great overview there and just because you mentioned silver briefly you know people are waiting for gold stocks to wait make moves and silver is another one that people are definitely waiting for so do you have any brief thoughts on on what’s going on with silver and what we may see silver start Tove and catch up with gold I guess it already is a yeah I’ve been I haven’t been anti-s silver but I’ve been saying for a couple of years that it wasn’t going to the moon like a a certain Cadre of the Market had been saying for a long time and and that was the case and and reasons were grasped at as to why silver had to go up you know monetary debasement the end of the dollar that things we hear again and again and more recently people were saying it was going to be because of solar or renewable energy we need a lot of solar for solar well um this is an interesting point of Distinction and and and a point of education for your listeners is um that hasn’t come to fruition like silver is going up now not for any of those reasons right um even if you look at clean tech like solar has been one of the best shorts in the market like clean tech stocks have not been working so that’s not the reason that solar is going up or excuse me that silver is going up um what’s happened is that silver is being treated now as more of a precious metal uh than an industrial metal before it was trading sideways to down with copper and now that gold has called a bid you know silver is doing what it’s typically done in the past is it’s being treated more as a precious metal so um for the same reasons people are buying gold is the the it’s why people are buying silver and so um what I would say is that now silver is bullish where it had not been for a while it’s bullish for the same reasons that gold is bullish um and it will at some point in this bull market you know outperform gold like it’s done in the past so it’s time to start positioning in silver it’s still um you know below $30 where its record price is is closer to $50 right here you already have gold at record high prices so Silver’s got some ground to make up um I don’t think we need to cover individual ways to play it I think about it the same way as I think about um gold so there’s trusts and there’s you know producer ETFs for example um what I will say is that on the more speculative side um just me personally and so this is an anecdote so maybe take it with a grain of salt but I’ve been invested in some private silver companies that have delayed going public for some time because the market hasn’t been conducive to to new silver stories because silver hasn’t been bullish I would expect you see some new silver stories come to Market because you have a you know a friendly window to to to issue new shares or to tell new silver stories to the market okay a lot of interesting points there on Silver and I have one I think follow-up question maybe on the psychological angle there I was talking recently to somebody who got into silver during that silver squeeze time and of course that and it kind of went sideways for three years and now they’re looking at it thinking well is it time to get out finally I’m a little bit in the green maybe I should be done with silver and of course I don’t like to give advice for me my reaction was like no not yet not yet so maybe there’s something in there about not selling too soon in this environment for sure I mean that’s you know typical bag holder mentality it sounds like is they bought the rip while it was ripping and that it’s taken three years to get back to even and now they want out um yeah a pretty good contrarian indicator I would advise similarly to you um and I’ve told my you know readers and I’ve told myself the same thing for some of those stocks that I’ve owned a long time is no you’ve got to give them time to run um it I guess I would parse the question in half maybe you know it it’s time to be reflective and um you know put in that work on your portfolio going back to what I was just say saying about being selective you know maybe if you you know you can’t identify Catalyst or reason to continue owning it maybe you know this recent bump is um giving you the volume and the price you need to get out at break even um or or slightly positive but if it’s one that you can identify as you know having future Catalyst that being well-run and being able to raise Capital that no I would say yeah continue to to hold it okay okay good to go into that and of course so another metal that we talk about most of the times that we speak and we spoke about it last time is copper and you and Tois the long-term fundamentals for copper were looking strong but it wasn’t quite working yet and now in 2024 copper is another metal that’s on the move so I wondered if we could go into that and take a look at what’s going on is it was there a catalyst there that’s driving it or is it more recognition of of those long-term fundamentals um it’s it’s both so there’s been a you know a looming structural deficit in in Copper for a long time that lots of people knew about you know The Wall Street Journal in Bloomberg would every couple of quarters run headlines about how um the world was facing a copper deficit and how much we needed for again green energy right for electrification for um electric vehicles Etc uh and yet the price remain subdued below $4 for you know most of the past two years despite all those you know catalysts and and and fundamentals that everyone knew about um that last interview and the title of it that we did was you know deploying cash into to gold and copper and I was telling you that I would do that in Copper after the recession so it’s similar to the gold answer what what’s changed is that the recession didn’t materialize um not just in the US um it didn’t materialize but other countries have started to come out of recession so um we began I was telling you I was going to buy it um when rates started to go down likely in the second half of 24 that’s changed so you and I haven’t spoken in five months we started buying copper in February um with my monthly issue um the back of China so China was my main reason you know China struggled to come out of its you know covid recession was in lockdown for longer has had well-known um you know economic issues with real estate and ever Grande Etc um but what happened heading out of 2023 to 24 is that the economic data in China as well as the stock market started to to improve um and you saw similar things start to happen in Europe uh specifically the big economies in Europe like Germany started to have um like PMI prints that were expansive above 50 for um you know the manufacturing and Services Industries so copper responds to that right it’s an industrial metal it’s a it’s a doctor of the global economy and so when China and Europe started to tick back up that’s when um copper started to tick back up as well so if I have to point to a moment in time in in a specific Catalyst it was it was then it was back in January and early February as the rest of the world started to um come out of the the recessions that they were in and as it be as it became clear that the US was not going to go into a recession and it’s interesting sorry one last thing on copper is you know last year it was the electrification that we needed all the copper and it didn’t go above $4 and now it’s above $4 and now we need it for artificial intelligence so you can see how the narratives change based on the price but really it’s the it’s the macro fundamentals and and super cycles that D price and the humans adapt The Narrative around yes yeah oh yeah it’s very funny I think artificial intelligence is just working its way into everything and copper certainly no exception so I think as with gold I think maybe it would be good to go into how you’re approaching the copper sector how you’re getting exposure yeah so it’s almost a mirror right sort of the same way um I don’t necessarily hold cop physical copper in the way I hold physical gold ETF but I do approach um investing in the miners the same way so um when we bought it in you know our retirement accounts we did so with an ETF and there’s a couple of them out there there’s um copex and IOP and then Sprout has a couple more on the junior side I selected an ETF that had more exposure to C to China at the time because that was the reason I was getting into it so um we bought IOP um it has you know all the ones you would expect BHP and anagasta um and even Anglo American as a top 20 holding with which you know in the past two weeks has got a $39 billion buyout offer on the table from BHP so um we had access uh and exposure to to those companies who are now you know going higher Ivan ho is in there um so we own all those big names via ETF and then again um when we speculate we do so based on share structure and management teams and catalysts so I’m just thinking about my speculative Holdings Al dearon for example is a company that’s done well has a very large um copper gold po free system in Argentina that they’ve been drilling out for years I’m well financed with deep pocketed Partners like South 32 um and and Route One and so no worry that they’re going to be able to raise money and then they have drills turning now so um you know this is one that despite you know it being known that they had a good asset that they had a resource um has you know I won’t say languished but remained subdued below 80 cents just like copper remain below $4 dollar but in the past couple of months you know alabar has gone from below 80 cents to around a dollar just as copper has started to come up so um it we speculate on different tiers of the copper Market just as we do in gold and um parse those out into different levels of of risk and then how we approach it okay so that covers I think what’s going on in Copper at a broad level and I want to also touch on uranium at least for a little bit right now because we usually figure out what’s going on there so I’ve I’ve definitely seen less interest in uranium as as gold is moving this year but yeah I thought we should check in and see you know is it is it in a consolidation phase right now are things going on that we’re not noticing what’s what do you make of the market there yeah gold and and copper has been more excited exciting in in 2024 and um uranium has been doing what you say it’s been consolidating so uh I had an exciting 2021 and then part of 2022 um but has been consolidating the sideways not just the the uranium price but the equities um you know for the past couple of months uh this is what I’ll say it’s a it’s a long game when you and I checked in five months ago I was saying it was the third or fourth inning of of a ball game again back to to baseball parlins um but it remains bullish so we say consolidating well what does that mean well it went higher fast I mean it went higher fast right you had uranium prices come from 20 below $20 a pound and in 2016 2017 to $100 a pound in in 2023 it was one of the best performing commodities I would say in the world last year um Market has to digest those gains and and that’s what’s been going on now that’s why the retail crowd is frustrated um but if you you look at the chart and if you look at the technicals the consolidation has been a consolidation of a bull market move and he wants to consolidate and then move higher higher highs um as opposed to to lower lows for example so uranium remains bullish uh I’ll be it in sideways consolidation mode and um I guess tying it back to what I write about it and and how I invest in it um you know Different Strokes for different folks and and and stocks are starting to do different things now like um I just give you an example Energy Fuels um was a selection of mine because of its us Focus uranium production and Mill capacity a couple of weeks ago they went and spent a quarter of a billion dollars something like 240 million us um on a company called base resources that has a a a mineral Sands deposit in Madagascar scar so changing focus more to to Rare Minerals and critical minerals as opposed to to uranium and changing focus in jurisdiction away from the US into to Madagascar so um we were fortunate enough to had been in Energy Fuels long enough that we still had a profit I didn’t like the way they they did that deal it changed Focus so it we repositioned we took our profits out of Energy Fuels and we deployed them into a similar company that has more North American uranium focus and so um and that’s just what I say about you know you have to manage the bull market it’s we anticipated it for 10 years and now you’re sort of inside it and and working through it and there’s decisions to be made and you don’t control you know sort of the inputs of those decisions like you know when I woke up that morning I didn’t know that Energy Fuels was going to spend a quarter million dollars on a mineral science play you have to sort of take that information and assess it um and I put my sales hat on and tell you that you know that’s what we do with digest publishing in our in our you know research letters yeah it’s it’s interesting to hear about your process kind of on a daily BAS basis and I’ll I’ll throw in one small question about uranium because I’m sure that people are wondering so we’re in this consolidation time where we think of we’ll be moving higher actually what do you think brings that next leg upward yeah um that’s an interesting question that I sort of thought you were going to ask and I don’t have a great answer for it except to tell you this um Commodities move in cycles and then I’m a big believer in in Cycles I talks about commodity super cycles and what’s driving them um and I think that it’s going to be a cascading or a wave effect right we talked about how sort of investors were bored with uranium right now because they’re more intrigued with gold and copper well you’re going to see that you know copper will do its thing for a little bit in Copper and then you know it’ll spill over into silver and pgms and then back into uranium I think that with higher inflation for longer and then with relatively stagnant growth it’s a good environment for Commodities across the board to move higher um and they’re just going to do so in in independent Cycles but um unfortunately my crystal ball isn’t going to tell me what the next one is going to be to send uranium higher but I can tell you that it remains in a bull market and it you know it will be something yeah and I appreciate I appreciate sometimes you know you just can’t really know at the moment so we we’ll keep an eye on uranium for sure okay so we made it through a lot of different topics and before I let you go I’ll put it back to you and ask ask if you had any final thoughts you would leave investors with or if you want to let everybody know where to find you yeah sure I appreciate that we did mention silver for a little bit so I would underscore that as one that’s a next to move and then I made a couple of notes and then pgms and nickel were also on there because um you haven’t seen a lot of talk about Platinum padium um they’re due for a run similar to gold and they are used in sort of the you know decarbonization space um and I think more so than people realize like the last truck I bought in 2021 was a diesel truck we’re looking to replace my wife’s Yukon that will likely be a diesel um and they’re in those catalytic converters that um you know make those cars burn cleaner and so they also some of those deposits are PGM plus nickel right you hear a lot about PGM plus gold deposits PGM plus nickel deposits I and nickel remains sort of in that electrification space we working through some Indonesian over Supply and we saw that Russian component out there too with the sanctions and things um they are good producers of pgms and nickel so just ones to keep an eye on for the the future I would say okay very good I think that sounds like a good place to wrap it up so thank you so much for coming on once again to go over all these topics thanks Charlotte appreciate it of course and once again I’m Charlotte McLoud with investing news.com and this is Nick C with daily cycle thank you for watching if you like this video make sure you subscribe to our Channel we’d also love to hear your thoughts so leave us a comment below we’ll see you next time [Music]

Nick Hodge of Digest Publishing shares his latest thoughts on gold, silver, copper and uranium.

“Gold is starting to check technical milestones,” he said about the yellow metal. “It’s checking technical boxes that tell broader, more generalist investors that gold is emerging from a bear market, and it starts to beget or attract capital simply because it’s going up.”

This interview was filmed on April 29, 2024.

#Investing #Gold #Silver

0:00 – Intro
0:27 – Gold’s main price drivers now
3:44 – Does the Fed still matter for gold?
7:51 – Nick’s approach to gold stocks
12:30 – When will silver catch up?
16:48 – Nick’s strategy for copper
22:10 – Uranium’s bullish outlook
26:53 – Watching PGMs and nickel
28:07 – Outro

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