Jordan Roy Byrne: Junior Sector Bottom Is In For Gold! – 1/16/14
In this interview, Jordan calls for a major bottom in the junior gold sector. He states a low is in for the GDXJ, but cautions that further downside may still exist for gold, silver, and the majors.
Why? Because December was ripe for tax loss selling, yet the stocks did not make a new low. The market was trading in a territory where it really should have continued down lower, yet the GDXJ had a reversal to the upside.
Jordan states that bear markets and corrections are a function of price and time, meaning that bear markets have a price and time component. In 2008, investors witnessed a strong correction in terms of price, but very limited in terms of time. What investors have had in this bear market has been a sizable price decline, over a very long period of time.
In lining up all the past bear markets and comparing them to the current bear market, Jordan has difficulty making a case that the bear market is not over. If the metals make new lows, that would effect the large caps much more than the juniors. With respect to the metals, he is less convinced that the metals have seen a final low. Remember back in 2000, the gold stocks bottomed before gold or silver.
In conclusion, Jordan believes that if a bottom is in fact in for the GDXJ, investors can expect 50% price gains in the next 6-9 months.
Jordan Roy-Byrne, CMT is a Chartered Market Technician and member of the Market Technicians Association. He is the publisher and editor of TheDailyGold.com, a publication which emphasizes market timing and stock selection for the sophisticated investor.