Loading ...By Barbara Kollmeyer and Barbara Kollmeyer
Published: Dec 28, 2016 9:43 a.m. ET
Predictions? Who’d have ’em after 2016’s wild moves.
Check out the 2016 Financial Market Awards handed out by A Wealth of Common Sense’s Ben Carlson. Among them “Biggest Round Trip: Gold miner stocks.”
Carlson offers up the “amazing” chart below that shows the ride to the top and down again for one triple-leveraged miners ETF JNUG, -3.85% . By the numbers, the fund was up nearly 920% by late August, but has since lost 87% of that. It’s now up over 40% for the year.
A Wealth of Common Sense
That brings us to our call of the day — a prediction about precious metals. It’s from Lamoureux & Co.’s Yves Lamoureux, who thinks he knows how 2017 will roll out for those plays.
“Both gold and silver will go down for the first half then move into a new bull market that will last well into 2020. This is the way the market shakes off the last remaining weak hands, prior to resuming the bull trend,” said Lamoureux in emailed comments.
“Where most turned bullish in 2016, in reaction to higher prices, we did not. Our view was and is that the bounce was an echo bubble of the prior bubble,” he said.
One reason is that he says rising real rates will “kill precious metals.” So for silver SIH7, +0.16% , he says expect lower teens in the first half, while he’s still sticking to a gold GCG7, +0.05% target of $850 an ounce, which he’s held since February.
Note, gold could mark the first rise in 8 weekly sessions if the positive momentum we’ve seen thus far has legs. This year, the commodity is on pace to have halted a multiyear decline, in what some say has been a “pivotal year” for precious metals. Others say investors are riding a downward “slope of hope.”
Gold has slumped since August, but it still is around 7% higher as the year winds down, while silver SIH7, +0.16% has fared even better with a 14% gain.