Money into the Gold Stocks?
Source: Goldmau.com, Claude Cormier (3/17/09)
"Strangely enough, big money has been flowing into those gold stocks. . .especially in the last month."
For sure, these financings have caused a lot of dilution, which in many cases, was probably not necessary. Unless gold explodes in the longer term as we expect, this dilution could have a negative impact on stock price in the weeks ahead.
As expected, gold stocks, using the HUI as the benchmark, came back down 21% to support at $250 and rebounded 12% to the current level.
Similar to gold, stocks could go in either direction from here, to new highs or towards the lows for additional testing. Again here, we think the odds support the former.