http://www.stockhouse.com/Columnists/2012/Feb/3/Time-to-get-long-junior-miners
Time to get long junior miners
Toronto Venture Exchange is up 16% over the last month and it's crossed above its 120-day moving average
Things are looking bullish for junior mining stocks...
We track the junior mining market with the TSX Venture Index. It's sort of the "Dow Industrials of tiny resource stocks." The last time we checked in,
Today, though, it looks like things are turning around... The Venture is up 16% over the last month. And it's crossed above its 120-day moving average – a simple trend indicator. I think this could be the beginning of another bull run in junior resource stocks. The conditions are perfect...
The long-term bull case for gold and silver is still intact. The U.S. and Europe still have huge debts and unfunded liabilities that can only be paid back with devalued paper money (which is bullish for precious metals). And the growing economies of Asia are still accumulating more gold each year.
After almost a year of terror, all the bad news is priced into the market. Several companies were trading for less than the cash in the bank. And some of the best stocks in the sector dropped 80%-90%.
But now, investors are tired of being afraid. And it looks like the world might not end... So some investors are dipping their toes into the risky pond again. The Venture Index is within spitting distance of breaking its November high at 1,670. Once it does, the rally is official.
If this is a new bull run, we could see similar gains this time around