James Turk - Expect Extremely Bullish Action in Mining Shares

With gold and silver consolidating recent gains, King World News interviewed James Turk out of Spain. When asked about the action in both gold and silver Turk stated, “We should see a very big up-move in both gold and silver shortly. There is no question that the highs will be taken out on both metals, it is now just a question of when. I view the pullback off the highs of today as meaningless noise.”

December 2, 2010

“The market in silver is very tight, it hasn’t loosened up at all. The takedown we discussed in a previous interview that was an attempt to shake out strong hands in the silver market did not work. We actually had an increase in demand into that decline.

We may test support one more time, but there is enough of a base that has been built, it is strong enough to launch it. So you don’t need one more dip. The next upleg will begin with a break above $30 on silver and that should take place in short order.

The gold/silver ratio is once again below 50, that is a bullish indicator. When we take out the low of 48.70, silver should be trading above the previous high of roughly $29.30. Silver would then be leading which I really like to see.”

Gold also appears ready to launch, despite pulling back to even on the day. What are your thoughts on gold?

“Gold is taking a little longer to develop because it had several days of trading above $1,400, so some short-term resistance built up there. But I like what the gold chart is doing, it is creating enough of a base to power through that minor resistance level.

The bottom line is that I expect silver to take out its high, to be followed by gold hitting new highs a day or two later. It is important that gold confirms the new high in silver so that both metals are trading in synch with each other in new high territory.

By the way Eric, I like very much what the gold stocks are doing here today. We are seeing some real strength which suggests higher prices in not only the mining stocks, but also in the precious metals as well.

What we should see is the XAU which has already confirmed, followed by a confirmation of new highs on the HUI as well. You know my view has been that the new bull market in the mining stocks began when the XAU made a new high above 206 back in October.

Just to be clear, going forward we should expect extremely bullish activity in the mining shares.”

The comments at the end by Turk remind me of Jim Sinclair’s statement that people should hold on to their book (positions) right now. In secular bull markets, it is a huge mistake to lose your position. At the same time it is very difficult for individuals to hold on all the way to the mania. As Richard Russell often says, “Very few human beings are able to hold for the duration of a bull market.”

Eric King

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