The Morgan Report Newsletter March 2015

This month’s issue starts with an editorial discussion of the current trending congestion action in gold, silver and the mining stocks with our view on when the opportunity is going to arrive. When then launch into an in depth look at the gold/silver ratio. What its told us in the past and what it may reveal in the future. Next up is an informal analysis of a best of week gold producer. This is actually a situation with an ounce of gold per ton. It’s in a very mining friendly district.

Then we follow with a mining company update on a Mexican silver producer whose all in costs have dropped like a rock. We have a guest editorial from a Mexican gentleman who I met in Vancouver. He may be publishing The Morgan Report in Spanish. It’s already translated in German and Mandarin. His guest editorial was about buying silver in Mexico and explains why the banks stopped issuing silver coinage.

Read this except from the March 2015 issue.

Certainly at the risk of looking defensive, and admitting it has been quite some time since precious metals investors have had much to cheer about, we continue to maintain the importance of this sector in an overall balanced portfolio. The price action in precious metals continues to puzzle the majority of investors. Almost everyone in this market sees great value and extremely depressed prices, so it only makes sense that many, we among them, have called a bottom in this sector. The most recent price action showed us an oversold condition being reached in December 2014, from which a powerful rebound occurred in January of 2015. Obviously, it was only normal to yet again hear calls that the precious metals sector bottom has finally been reached.

However, what has us concerned is that the precious metals have not registered a higher high on the weekly chart, which usually signals an uptrend is beginning. Both gold and silver still keep printing a pattern of lower highs. Hedge funds and other speculators piled into the market near the lows and into January and were holding the largest net long position since late 2012. So, many may think the bottom is in, and yes, we still think the bottom was seen late last year.

The two most important facts that MUST be studied are price and volume. Since the low, the volume of buying has been quite strong, but looking at how the price has reacted to all that buying, again, concerns us. Because almost everyone who is currently a member is a well seasoned investor and most with a longer-term outlook, let us restate that we still think the price action will be choppy probably up until the third quarter of this year. We expect the September timeframe to provide a significant shift in sentiment from the stock market into the precious metals once again.

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