In a search looking for other related gold stock, ETF patterns I found 3, but I will work with just one of them. PSAU is one of them, which also pays a current dividend yield of 4.65%. PSAU ETF Guide | Stock Quote, Holdings, Fact Sheet and More
Since early 2016, PSAU bottomed like so many other gold related stock assets did, and then PSAU exploded into the mid 2016 peak after which PSAU went south developing a bearish phase. The first move up in 2016, ended with a 245% gain, and gathered worldwide attention that a gold bull market has arrived.
It took the majority 6 months or so to figure it out, and as soon as the mass media talking heads were in consensus agreement, the gold stock market turned bearish. Bitcoin was the latest craze, and who needs gold when Bitcoin is as good as gold? Nothing is as good as gold, except “gold”. Dumping gold for Bitcoins was the battle cry, but then Bitcoin crashed and has yet to break out into new record price territory.
Late last year PSAU seemed to have turned upward again from a base of $18, touching $20 before backing off. Yes, that $18 price level is a line drawn in the sand, because if we are back to the bullish phase, we don’t want to see that $18 price level get trashed for any reason. Even if that $18 price level didn’t hold, this bull market is not over until the majority of my Gold ratios show overbought conditions.
We’ll be starting our third year with this bull market, and it may still take 1-2 years before it’s finished. GDX and GDXJ have similar stock patterns, but PSAU pays out a much higher dividend payment.
My top trend line is based on the two biggest dips connecting the bottom trend line. I always draw these trend lines in parallel fashion, but there is no guarantee that the top trend line will ever get hit. I have to check a few more top and bottom ratios, but I have at least two I can work with. Our present Gold/PSAU ratio is sitting at 66.36:1, and it still has a long way to compress until we get into an expensive 27:1 ratio. PSAU may never reach that extreme, but a ratio of 66:1 seems to be pretty normal right now.
I believe that PSAU can still double up from todays price levels, as “C” wave bull markets can and do produce some amazing or stunning vertical moves.
Short term the gold stocks could still be in a correction mode, but long term I’m still very bullish.