Dog Days of Winter But Salad Days for Miners

The hot summer, and even the warmer days of autumn, seem like a distant memory at this point in the year, even as winter still has officially more than a month left on the calendar.

Whether spring weather arrives on time this year remains to be seen, but what has arrived of late has been an impressive resurgence in the precious metals and their derivative miners. Seeing the U.S. Dollar slow down of late has not hurt, ether, since the greenback typically trades inversely to precious metals. 

But at a certain point gold bugs will need to set aside that correlation and demonstrate that underlying demand for their precious yellow pet rock is so strong that the Dollar price action is quasi-irrelevant. 

Moreover, we want to see a true risk-on feel to the precious complex, with miners paving the way higher and the metals, themselves, coming along for the ride, rather than the metals trying to drag reluctant miners all the way up, the latter scenario typically a doomed one for bulls.

Look, we have been down this road many times over for years on end--The precious miners simply have been unable to sustain rallies to the point where we would be onboard for a full-blown, new bull market. As an example, inside the VIP arm of Market Chess Subscription Services, a recurring theme, for years now, has been to reiterate that I have two large cap precious miners in my long-term investing portfolio as placeholders, and would only add more mining exposure if and when the complex confirmed a new bull market. 

So what gives now? Is this the real deal breakout? Gold is gapping close to its early-2018 highs, an area from which it sold off hard. But markets are acting very well, overall.

I suspect the near/intermediate-term outlook for the complex is bullish with rising momentum. As for the long-term, let's see if gold bugs have the gumption to at least not slip on the banana peel this time around after a promising rally.

In the meantime, a name like GORO serves as a quality "catch-up" long idea to peers, as it bases under its 200-day moving average but could easily get moving soon.