Jeb Handwerger: Here Are The Commodities That Are Outperforming in 2014
At the time of recording this interview, the price of gold has pulled back to the $1250 level, the HUI is testing the 200 level, and the uranium spot price is at $28.25 per pound. We talk to Jeb about what these price levels tell us about commodities in 2014 and look at which commodities are outperforming.
Jeb says that the price action in many of the commodities are painful in the short term. We are in the middle of the summer doldrums and sentiment is extremely negative, like we saw in late December of 2013. Jeb believes that will set the junior sector up for a rally in late fall.
While gold and silver are dropping, Jeb is also seeing some strength in certain metals such palladium, nickel, and platinum, which are all outperforming. There are some bright spots so far in 2014.
Jeb believes that uranium prices are irrationally low. Most smart investors look for long basing periods and points of capitulation to accumulate positions. Jeb points out that if you look at the long term fundamentals for uranium, the case is very strong for a major rally to occur. For this reason, he believes that there is a lot of money on the sidelines that will enter the space. As one example, Jeb looks at Uranium Participation Corp, which just raised over $58 million to purchase spot uranium, but no significant buying has occurred yet.
In Japan, Jeb notes that the country has come out with a plan for nuclear power to once again provide base power for the country. Even Germany, he points out, may look to turn back on its nuclear power to deal with skyrocketing electricity costs.
So why are the precious metals dropping? Jeb believes it is due to sentiment that the overall economy is improving. He believes that this same sentiment has led to many of the industrial metals moving up such as nickel and the PGMs.
Although the junior mining space has been dropping, Jeb believes that by doing proper homework, one can uncover gems in the sector that are outperforming. What stock are Jeb looking at that have outperformed? In the heavy rare earth space Jeb is looking at Niocorp. Another company which he is looking at is a lithium company held by Western Lithium. Others include Ucore Rare Metals and
Gold Stock Trades Editor Jeb Handwerger is a highly sought-after stock analyst syndicated internationally and known throughout the financial industry for his accurate and timely analysis of the equities markets, particularly the precious metals sector.