Gold bullion has rallied from the recent bottom of slightly under  $1200 to approximately the $1375 level.  As most of us are heavily involved in the Gold Mining Stocks, many of us are disappointed when we have a pullback in prices. But that is what we should expect and want to see. Want to see?

Examine a gold chart, you will find that when gold bullion has a move up of about  $200 or more within a short span of three months or less, it will usually come back minimally in the amount of 30% to 50% of its upmove.

If you have an even greater move up than $200, expect trouble as you probably will see a brutal move down leading into a bear market. What I am saying here is that a moderately sharp upmove such as we have recently seen brings with it a normal  correction.

Our overall analysis suggests that we are in a bull market for mining stocks and that a solid and consistent move up for many of them will continue. The price bottoms for many  of the mining stocks began last summer and our research suggests that prices will not return to the price lows of that period. Thinking that one can wait and later “back up the truck and load up with all the undervalued mining shares that would be thrown away later on” is delusional thinking.

For over six months, we have had a “sale on mining stocks” that is ongoing. And as always, few have taken advantage; that’s the way it has always been.

“When prices are high, they run to buy…..when prices are low, they let them go!” Amen                                                                                                   Thanks, K.C. Grainger