22 www.resourceworld.com
F E B R U A R Y / M A R C H 2 0 2 0
At the Market
by John Newell
Learn to use both
fundamental and
technical analysis
S
ince my last article in the November /
December Issue of Resource World
magazine, the accompanying HUI Gold
Bugs Index has moved up sharply, and met
and exceeded the 240 area I highlighted as a
potential target. This area can offer resistance
at least in the short term. Of course, traders
can take profits, momentum traders may be
initiating positions, and patient long term
investors may just sit on their share positions.
In the world of investing today, much has
changed from the days of the famous stock
trader Jesse Livermore (1877-1940) who is
considered to be the pioneer of day trading,
but I am reminded of him and wanted to men-
tion a quote attributed to him. "It was never
my thinking that made the big money for
me, it always was sitting." This is borne out
by other more recent very successful mining
investors like David Lowell, Ross Beatty and
the Lundin family who have made mining
fortunes by finding and developing mineral
projects over many cycles over the years.
In this new investing climate, investors
are faced with the constant chatter of vari-
ous investing websites and youtube that keep
investors informed; however, they can also put
investors off their game. With so much 'noise'
out there, I would like to remind investors to
'know thy self" and not lose sight of the basic
potential that lies ahead for the mining sector.
I believe a major bull cycle began in
January 2016 and despite a longer and deeper
correction that one would reasonably expect
in a bull market, we never have breached the
2016 lows. This gives me hope that the best
gains in the precious metal market lie ahead of
us. I am of the view that investors can benefit
by the use both fundamental and technical
analysis to study companies.
Top, S&P/TSX Global Gold Index. Bottom, Gold Bugs Index NYSE Arca.
