The gold price saw both peaks and troughs this week, reacting to the release of June consumer and producer price index data out of the US, as well as renewed discussions about whether President Donald Trump may fire Federal Reserve Chair Jerome Powell.
Silver was the real precious metals star, pushing past the US$39 per ounce level once again.
What’s happened is we broke through that US$37 to US$37.30 resistance level — after failing there, by the way — which is also a technical bullish sign. And then we rallied all the way to the US$39s, but we hit resistance between US$39 and US$40, which is not really unexpected, because it was a really quick move from US$37 to US$39.
I think US$40 is a big, round number that doesn’t have a lot of resistance on the long-term chart, but it’s still there in people’s minds.
It’s going to take a little bit to get through US$40. But once you’re by US$40, then it’s absolutely go time if you don’t think it is already.
Take a watch for more on silver, as well as the gold, platinum and copper markets.
Bullet briefing — MP shares rise, Barrick and Discovery talk Hemlo
MP Materials signs deal with Apple
MP Materials (NYSE:MP) was in the headlines after announcing a US$500 million partnership with Apple (NASDAQ:AAPL). The companies said on Tuesday (July 15) that they have entered into a definitive long-term agreement through which MP will supply Apple with rare earth magnets.
The magnets will be made in the US, and will use 100 percent recycled materials.
The news follows last week’s new partnership between MP and the US Department of Defense. A key component is a 10 year deal that sets up a price floor commitment of US$110 per kilogram for MP’s neodymium-praeseodymium products, a move geared at creating supply chain stability.
The defense department will also become MP’s largest shareholder, buying US$400 million worth of preferred stock and receiving warrants to purchase additional common stock.
Shares of MP spiked on the news and have stayed high since then.
MP describes itself as the only fully integrated rare earths producer in the US, and the moves from Apple and the defense department reflect a growing push to diversify away from China.
Investors are taking note of the rare earths opportunity too. Here’s how Rick Rule of Rule Investment Media described the sector’s potential in a recent interview:
If you want a gamier suggestion, I really like the high-quality rare earths space. Nobody understands it, nobody cares. There are probably 50 pretenders in rare earths, but there are two or three speculations that, while you could easily lose 30 percent of your money, you could also easily enjoy 20 baggers.
Watch the interview for more, including Rule’s favorite ASX-listed mining stocks.
Barrick, Discovery Silver in Hemlo talks
Major miner Barrick Mining (TSX:ABX,NYSE:B) is reportedly looking to sell Hemlo, its last remaining Canadian gold mine, to Discovery Silver (TSX:DSV,OTCQX:DSVSF).
According to Bloomberg, the companies are in ‘advanced talks’ about a deal.
Located in Ontario, Hemlo’s 2025 output is forecast at 140,000 to 160,000 ounces of gold at an all-in sustaining cost of US$1,600 to US$1,700 per ounce.
The move to sell Hemlo comes as Barrick hones in on tier-one assets and broadens its focus. It changed its name from Barrick Gold to Barrick Mining earlier this year, with its latest divestment being the sale of its 50 percent stake in the Alaska-based Donlin gold project for US$1 billion in cash.
For its part, Discovery Silver has been on an expansion path, closing its acquisition of Newmont’s (TSX:NGT,NYSE:NEM) Porcupine complex this past April.
In addition to Porcupine, Discovery holds the Cordero silver project in Mexico.
Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.