Sir Norvast of Gann has posted a comment under the welcome post. This Deserves a post of its own in case you missed it . here you go :
Many members would have heard me articulate my views about the 30 year commodity cycle.
The current commodity cycle commenced around 2000 and will end around 2030.
What we have experienced during the period 2011-2015 is a half cycle correction within that broader cycle.
I am of the view that the 1/2 cycle correction ended in late 2015.
As it turned out this is almost exactly 30 years from when the 1/2 cycle correction ended in 1985.
At that time I was a young civil engineer working in outback Australia for a company that was trying to win work on a potential rich gold mining project called “The Granites” owned by North Flinders Mines.
Shares in that company traded between AU$0.10 and AU$0.20 but over the next few years traded (without splits) up to around AU$60.00
The expanded mine is now owned by Newmont Mining and still produces 300k+ oz gold annually.
I think that we are at a very similar stage in the long term cycle as we were in 1985-86 with gold leading other commodities out of the wilderness.
By following the shorter term cycles we should be able to take advantage of this new up-tick in commodity prices, either as a trader or a medium term investor.
I hope you all enjoy the cycle ride
Staying with gold…
Gold is an important export for Australia but at the end of the day it is the miners who find the resource and produce the product and whose responsibility it is to act in the best interests of the shareholders!
That generally means making money or profits.
All through 2013-2015 I was looking for the miners to improve their profitability and bottom in share price as part of the broader half cycle correction.
on 07 Nov 2014 gold found it’s YCL, but here in Australia the miners did not suffer as much as their US and Canadian friends.
The USD was moving higher therefore AUD was moving down so the price of gold in AUD was around $1550 an oz,
Oil prices were plummeting and oil & diesel are significant expenses in the earth-moving business,
Wages and contract rates were stabilising.
Australian miners production costs were around AU$1,050 per oz
They were making good money and represented excellent value.
By the time the next significant weekly cycle low (ICL) came around on 24 Jul 2015 the value of the XGD (AUS gold mining index) was much higher.
I elected then to buy & hold a large tranche of Australian miners.
Confirmation came at the next YCL on 03 Dec 2015 when the value of the XGD was higher than the previous ICL’s even though gold had reached a bottom in USD terms.
This is an example where longer term or broader cycle analysis can be used with the intermediate cycles (22-26 weeks) to confirm your strategy and investments