3 'Uplifting' Metals Stocks

Focus: COMMODITIES

Jason Burack Image Jason Burack Co-Founder, Wall St. for Main St., LLC

Uplifting is a term that means stocks that are lifted up from the obscurity of a local market and launched onto an American exchange, and grabbing the right shares before that happens can mean big profits, writes Jason Burack of Wall Street for Main Street.

Gregg Early: I’m here with Jason Burack, co-founder of Wall Street for Main Street. Jason, gold seems to be rallying again, and there’s been a disparity between gold and the mining stocks. Where do you see that diversion heading? Do you see it continuing or do you see it changing and narrowing?

Jason Burack: Well, I see the diversions ending. I see the mining stocks finally starting to outperform bullion.

For a recap here: over the last 12 months, mining stocks have massively underperformed bullion on a percentage basis. A lot of the miners, including the producers, some of them were down 60% to 70%. They had cost problems because the bullion prices had a correction, and then the intra costs—like energy intra cost, labor, costs to build a mine—all rose.

So what I would say here is on the charts, you can take a look at the GDX, or you can take the gold price and divide that by the GDX.  If you look at those types of charts right now over a five-year maximum chart, you can see that there’s a nice, really solid double bottom, like a W, and then also there’s another continuation pattern and there’s a cup with a handle chart forming. So it’s very, very bullish in that respect on the technicals.

The fundamentals are improving also, because gold and silver are finally starting to move higher.