Gold is heading into a seasonal upswing, and Mercenary Geologist Mickey Fulp believes it’s an opportunity for investors to profit.
“What we’ve noticed is on a yearly basis you see about a 10-percent rise in gold [from November to the end of February],” he said at the recent New Orleans Investment Conference. “You can buy gold right now and likely sell it at the end of February based on [that seasonality] and make money.”
Fulp is also interested in gold stocks right now, and mentioned three new US-focused exploration companies that he’s looking at right now.
“One of them is a spin out from Columbus Gold (TSX:CGT) called Allegiant Gold. I’m a shareholder of that company and I’ll be a shareholder of the spin out,” he said. He’s also got his eye on Integra Resources (TSXV:ITR), a new company from the team that led Integra Gold to a takeover earlier this year. It began trading on the TSXV on Tuesday (November 7).
Watch the interview above for more insight from Fulp on gold, base metals and other companies he’s interested in currently. The transcript for this interview is available below.
INN: Let’s start by talking about gold. The last time I checked, gold was up year-to-date, but was well below $1,300 still. Where do you see gold heading as we finish 2017 and head into 2018?
MF: There’s a seasonality of gold that goes from November into the end of February, [which is] basically a four-month period. And what we’ve noticed is on a yearly basis you see about a 10-percent rise in gold from that period time. It is especially strong starting after, say, close to the end of the year — you kind of have this curve that goes up. I’m pretty bullish on gold for that reason. Now, I have to say that the tracking of gold this year has really been correlated to the US dollar. So as the US dollar goes up, gold goes down, and I really don’t see that changing.
INN: If you’re an investor, what should you do right now to take advantage of that?
MF: You can buy gold right now and likely sell it at the end of February based on the seasonality we’ve [seen] over 20 years and make money. Now, I’m not a gold trader. I’m a gold hoarder, so I don’t [sell] — I buy gold on dips. I buy it, I don’t really sell it.
INN: Apart from gold, what other commodities are you interested in right now?
MF: Base metals have done very well this year. Copper, lead and zinc. Copper now has busted through … the last time we talked I don’t even know if it was up to $3, but we saw that coming. It went above $3, fell back and consolidated in the $2.90 range more or less, and now it’s gone on another run and it looks like it’s consolidating, hopefully in the $3.15 range. The next resistance in copper would probably come in at about $3.30.
INN: You mentioned lead, that’s one we don’t hear too much about. What do you like about lead?
MF: Lead hit a seven-year high a couple weeks ago — I think it was up to about to $18 … but once again it’s this incipient bull market for commodities. And there are supply concerns both in the zinc and lead markets, especially involving China, [and that has led] to record prices. Zinc was at a 10-year high last week … [and] it keeps doing that. If you look at all those metals in terms of their potential for increase, I would still say copper has been the laggard of those three base metals.
INN: With copper and zinc it’s not too hard to find [companies to invest in]. What about lead? What do you with that?
MF: If you’ve got a zinc mine, you’re going to get a lot of lead with it. So zinc, lead and silver all go together. Very few of those mines would be standalone for zinc. I don’t know any other than the lead deposits of Missouri, and those are non-public venue — that’s a private company… but those two metals go together. So you’re not going to find a pure lead play, you’re probably not going to find a pure zinc play and you’re certainly not going to find a pure silver play because those metals generally go together.
INN: Can you talk about any companies you’re looking at right now? Maybe some that are expecting milestones or catalysts?
MF: There’s two companies that I still cover, and I think I mentioned those the last time we talked. That would be Trilogy Metals (TSX:TMQ,NYSEMKT:TMQ) in Alaska — still very bullish on that, it’s done quite well lately trading … in the $1.15 range. They’ve got catalysts coming, they’ll have a feasibility study out by the end of the first quarter next year, they’ve got drill results coming. Hannan Metals (TSXV:HAN) is drilling zinc in Ireland as we speak. I cover both of those companies, I’m a shareholder.
Recently I moved into some new companies in the gold space in the US. I can mention a couple of them. One of them is a spin out from Columbus Gold called Allegiant Gold. I’m a shareholder of that company, I’ll be a shareholder of the spin out, and I imagine I’ll cover that company with their Nevada plays.
I’m also an early stage shareholder of a new company called Revival Gold, they bought the Beartrack mine in Idaho from Yamana Gold. Integra Resources, Integra 2.0 — this is in the process of an RTO right now. They bought the old DeLamar mine from Kinross Gold (TSX:K,NYSE:KGC), I’ll be involved in that deal too. Now, neither of those two are trading yet, but they will be. Allegiant should be trading I think sometime by late November, and I think for the new Integra … at the end of the year or the beginning of next year.
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
Hannan Metals is a client of the Investing News Network. This article is not paid-for content.