PM Stock Potentials

September 12, 2005
"WOWZERS!"

This series of editorials spawned over a few weeks from a series of posts on the Gold-Eagle Forum. My advice at that time was to simply follow the price movements of RGLD and others. At that time Royal Gold had seemed to re-establish leadership, a leadership that led the HUI in Wave I.

With the support of Dr. Vronsky at Gold-Eagle.com, I elected to write my first editorial as if it were the beginning of a series. This series will attempt to oscillate around the PM complex in an attempt to tie together all of the loose ends. I think it is essential to understand the historic role and movements of Gold and Silver as they take their lead monetary positions as Real Money- the ultimate reservoir of maintaining value. Everyone needs to understand what Gold and Silver means to the stability of life, and everyone should have a plan of life based on the security of Gold and Silver.

If we find time, we might return shortly to take a further look at the physical Gold and Silver markets in relation to the evolving environment of today. For now, though, we will turn to the potential price targets of some selected PM stocks as our historic PM 5th wave plays out. These potential price targets are proposed as the potentials of Wave III, as physical Gold and Silver move toward an important monetary role.

For anyone doubting the possibility of much higher prices for the PM stocks, I would suggest reviewing an article written by Mr. Gofsky and held safely in the Gold-Eagle Editorial Archives. For I can hear History whispering softly…….……."You Ain't Seen Nothing, Yet."

[Please not that all potential chart targets were developed using what I call "directional lines." That means that we have not yet drawn channels and that prices may trade both above and below the line. We have developed these directional lines as outlined in our original HUI editorial, based on fractal considerations. Some targets might seem a bit perverse to some, but simply reflecting on what happened in the previous Wave I, and considering the historical experience of the 70's, well……. Please due your own due diligence before investing in anything!]

 

For RGLD, the first target might come around year-end at the green dotted line at around $37. Once reached, we might see a correction downward, or we might see a lateral move into a triangle formation. With the MACD moving higher supported by a rising ADX line, the suggestion is that RGLD is in a "trending mode", de-emphasizing the importance of oscillators that might get and stay overbought. This relationship of the MACD and the ADX line was brought to the Gold-Eagle Forum by a poster named AuricGoldfinger. Thanks AG……if you get the chance, click on my e-mail, below, and give me a shout.

The upper trend line for GG currently lies up around $25. A potential for this Wave III move might be to around $80, a move that started around $10. Long a favorite of PM stock investors, GG usually is one of the leaders of impulsive moves.

With a brand new break-out to new highs last week, Meridian Gold might be one to watch in the near-term. A potential Wave III target might fall around $99.

Newmont Mining is considered one of the class acts of PM mining. The Wave III potential target might well run up to around $134 with shorter-term targets of around $53, then around $80.

Since there might be more interest in NEM, below is a live link to the cup 'n handle chart version.

http://stockcharts.com/def/servlet/SC.web?c=NEM,uu[w,a]maolyyay[d19900721,20051231][pb50!b200][vc60][ium12!la5,34,5!lh5,5!ul14!lg!uc20][J55595453,Y]&listNum=1

Our next chart is of USERX, made famous by Dr. SKI Kern. It looks like USERX is making a big break-out with some intermediate-term resistance up at around $13. The USERX Wave III target might be up to about $25.

Here we have the Canadian chart of Eldorado Gold. EGO is trying to break-out above the downtrend line with a CA Wave III potential target of between $50 and $65.

Bema Gold doesn't seem to get much respect considering their properties under partial or full ownership. One of these days, owned ounces of Gold, Silver, and Copper-even if in the ground, might make a lot of investors look back at this chart in retrospect, knock their knuckles on their heads, and reciting "Nobody home!" A Wave III potential target might be around $32 to $40 with shorter resistance at $3.60, then around $7.

A live shorter-term look at BGO, below.

http://stockcharts.com/def/servlet/SC.web?c=bgo,uu[h,a]daolyyay[d20000721,20051231][pb50!b200][vc60][ium12!ug!la5,34,5!ll14][j58204367,y]&listNum=1

Though Cambior tends to lag a bit, the CBJ chart looks ready to rumble over the long-term. The old girl has a lot of work to do, but a Wave III target might come in around $33……..oops, look at that possible Wave V projection!

One of my favorites for LT potential is Golden Star Resources. It has some work to do, but if all comes together, a Wave III potential target might seem surreal at a whopping $70+. Make me Happy…….

There are some companies whose properties deserve to be drooled over, IMO. American Bonanza might just be such a company. If the drilling goes well, the Wave III target might go well, too………well, to around $18 that is. For MA2…….a little higher potential Wave III target.

Some mining companies have properties, but then some companies have PROPERTIES. So, what does a chart of a company look like when their properties are laden with Gold, Silver, and Copper? The only way I cannot see the chart of Novagold continuing to the moon is if someone on their staff has found a way to turn Gold, Silver, and Copper……into seawater.

Looking at potential price targets can be fun. Of course, nobody knows if the method we have used to create such targets will play out. Using a historical reference of the 1970s seems to suggest that these targets are not so unrealistic, but things happen in life. Please take such price targets with a grain of salt and do your own due diligence regarding any investment you might make. Also please remember that ownership of physical Gold and Silver should be the first goal in investing in the current environment, IMO. Buy some physical Gold and Silver, today! I do own shares of some of these stocks.

Again, I'd like to thank all of the posters at the Gold-Eagle Forum for their daily input. This thank you is especially extended to TQ and to Grininbarrett. Special thanks go to Dr. Vronsky and Westerman for creating the Gold-Eagle site and for editing my work. The Gold-Eagle Forum can be linked at www.gold-eagle.com/cgi-bin/gn/get/forum.html.

Thanks also go out to CaptainHook and David Petch of TreasureChests. I will continue to provide their link since I truly believe that their work would benefit everyone. They can be found atwww.treasurechests.info/index.php.

There are many great editorials that can be found on the Gold-Eagle site at the following link. www.gold-eagle.com/research/petchndx.html

E-mail contact:

Act0319@aol.com

A one-ounce gold nugget is rarer than a five-carat diamond.

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