Sprott: Outlook for Gold Strongest in Decades! Mining Stocks Positioned for Massive Upside.

from King World News

The outlook for gold is the strongest in decades and the mining stocks are positioned for massive upside.

Precious Metals Take a Round Trip

July 9 (King World News) – Paul Wong, Market Strategist at Sprott Asset Management: For gold and precious metals, June was one of the toughest months in nearly five years (since November 2016). For the month of June, gold gave up all of its May gains, falling $136.76 per ounce (down 7.17%) to close at $1,770.11 on June 30. Most of the loss occurred immediately after the June 15-16 Federal Open Market Committee Meeting (FOMC) as sizeable macro-type funds were caught offside by the Federal Reserve’s (Fed) dot plot movement. Positioning was overcrowded and over-leveraged, and these investors were forced into a quick unwind. An aggressive curve flattening trade took hold, resulting in real yields spiking higher and the U.S. dollar (USD) backing up. In turn, a feedback loop for more position unwinding was created. Commodities, especially precious metals, are most sensitive to a strengthening USD and rising real rates and took the brunt of last month’s unwind and deleveraging.

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