Gold looks like a buy the rumour sell the fact trade, says Charlie Gibson, Head of Mining at Edison Research as he discusses the falling gold prices, and further shares two key mining stocks for investing – KEFI Minerals, Amara Mining, in today’s Tip TV Finance Show.
Gold: 5-year lows, but still higher than 15 years before
Gibson notes that although Gold prices have seen 5-year lows, its value remains too high when compared to a decade before. He highlights how Gold’s reaction to any political situation remains short-lived.
On the currency price action, he says that Gold is being played by US rate expectations. Gibson doesn’t see the Fed raising rates in December, and believes that once the market absorbs this, a real turnaround in sentiment will come about in the gold market.
Gibson further shows the share price at each stage of development for a Gold miner, using a hypothetical company valuation per share chart over a period of years. Watch the video for further insights.
Mining stocks: Kefi Minerals Plc (L:KEFI), Amara Mining Plc (L:AMARA)
KEFI Minerals: Raised $4 million recently. Share price has upside potential as they approach production in 2018.
Amara Mining: Bounced off lows for this year. High degree of confidence that it can turn into production.