Market Tech Jordan Roy-Byrne On Precious Metals
The Gold Report | Mar 26, 2013 06:49AM ET
Jordan Roy-Byrne, editor and publisher of TheDailyGold Premium, was able to achieve some marked success in last year's choppy market by buying growth-oriented producers. After the broader market tops out, Roy-Byrne is watching for the same stocks to outperform again. In this Gold Report interview, Roy-Byrne talks about how a decoupling in the market between stocks and gold is an indication he's right about buying stocks with relative strength, and growing cash flow and production.
The Gold Report: Since November, there's been a decisive break between the S&P 500 and gold, bullion and the AMEX Gold BUGS Index (FNV ) is a simple example. We first bought that in October 2011 at $35. It was a very strong stock that had corrected and appeared to have bottomed. Franco-Nevada went up to $60/share recently, but it's had a severe correction because of a huge amount of redemptions. It's about $46/share, about 20% off its high. It has cash-flow growth, and it's consistently leveraged to the bull market. Now is the time to buy. It's a no brainer. That's what I'm looking for. Don't buy the strong stocks when they are making all-time highs. Buy them after they've corrected, when they offer value.
TGR: That's good advice. Do you have any parting thoughts?
JRB: I believe we're going to get a good rally in the mining stocks over the next two months—I'm short-term bullish. Gold has put in an important low amid extreme bearish sentiment. That is very encouraging. We should see a rally, and then a potential soft period in the summer or early fall. However, by the end of the year I think gold has a good chance to break past $1,800/oz. I'm more bullish on 2014 than on 2013.
Now is the time to do your research. Look at companies that have the ability to grow their cash flow and production over the next few years, because these companies are consistent winners that are consistently leveraged to the bull market.
In regard to the juniors and development companies, I'd offer two criteria for research. Look for companies that are cashed-up, and are trading above their 52-week lows. Cash and relative strength!
TGR: Thanks for speaking with us today, Jordan.
Jordan Roy-Byrne is a Chartered Market Technician, a member of the Market Technicians Association and a former official contributor to the CME Group, the largest futures exchange in the world. He is the editor of TheDailyGold Premium; the TDG Premium Model Portfolio was up 32% in 2012. His work has been featured in CNBC, Barron's, Financial Times, Alphaville, Yahoo Finance, BusinessInsider, 321gold, Gold-Eagle, FinancialSense, GoldSeek and Kitco.
DISCLOSURE:
1) Alec Gimurtu conducted this interview for The Gold Report and provides services to The Gold Report as an independent contractor. He or his family own shares of the following companies mentioned in this interview: None.
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2) The following companies mentioned in the interview are sponsors of The Gold Report: Primero Mining Corp., Argonaut Gold Inc., Balmoral Resources Ltd. and Franco-Nevada Corp. Streetwise Reports does not accept stock in exchange for its services or as sponsorship payment.
3) Jordan Roy-Byrne: I or my family own shares of the following companies mentioned in this interview: Argonaut Gold Inc., Bear Creek Mining Corp., Corvus Gold Inc., Lachlan Star Ltd., Primero Mining Corp., Franco-Nevada Corp. I personally or my family am paid by the following companies mentioned in this interview: None. My company has a financial relationship with the following companies mentioned in this interview: First Majestic Silver Corp., Argonaut Gold Inc., Bear Creek Mining Corp., Corvus Gold Inc., Balmoral Resources Ltd. I was not paid by Streetwise Reports for participating in this interview. Comments and opinions expressed are my own comments and opinions. I had the opportunity to review the interview for accuracy as of the date of the interview and am responsible for the content of the interview.
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