{"id":20024,"date":"2022-08-18T07:30:44","date_gmt":"2022-08-18T11:30:44","guid":{"rendered":""},"modified":"2022-08-18T07:30:44","modified_gmt":"2022-08-18T11:30:44","slug":"why-new-money-will-flow-into-this-beaten-down-sector","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/why-new-money-will-flow-into-this-beaten-down-sector\/","title":{"rendered":"Why New Money Will Flow Into This Beaten-Down Sector"},"content":{"rendered":"

Andrew’s Note:<\/strong> If you’re feeling anxious about your finances, you’re not alone. Inflation is at a 40-year high. Layoffs are sweeping the U.S. And foreclosure filings are up 150%.<\/p>\n

That’s why last night, Jeff Clark issued the most serious warning<\/a> of his career – he calls it “America’s Darkest Hour” and it could be like the 2008 financial crisis.<\/p>\n

To get ahead of this crisis, click here to watch Jeff’s warning<\/a>. There, he’ll reveal the exact steps you need to take to turn this crisis into an opportunity to make as much as 186%, 597%, and even 954% in a matter of days.<\/p>\n

And below, read on to see what Jeff has to say about the current gold market…<\/p>\n

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Relative to the S&P 500, gold stocks are just about as cheap as they’ve ever been.<\/p>\n

Now, before you roll your eyes and dismiss today’s essay as “that Clark guy is talking about gold stocks again,” consider this…<\/p>\n

The broad stock market is overbought and overextended.<\/p>\n

If all the warning signs we’ve looked at over the past few weeks start playing out – and we get a multi-week decline in the broad stock market – then what sector is likely to perform best?<\/p>\n

Intuitively, we might believe the best performing sector during a market decline would be the one with the best relative value. And that makes sense because when money comes out of overbought and overextended positions, it often flows into beaten-down value stocks.<\/p>\n

And right now, the most beaten-down sector with the most value is the gold sector.<\/p>\n

Look at this ratio chart comparing the action in the VanEck Vectors Gold Miners Fund (GDX) to the S&P 500…<\/p>\n

\"Chart\"<\/div>\n

As this chart moves higher, it tells us the gold sector is outperforming the S&P 500. And when the chart moves lower, gold stocks are underperforming.<\/p>\n

As you can see, the gold sector has underperformed the broad stock market for the past four months.<\/p>\n

The gold sector is as cheap (relative to the S&P 500) as it was last December – right before the chart reversed its trend and started to rally.<\/p>\n

The blue arrow in January points to the first “higher low” in that rally phase. That was the first bullish sign indicating the gold sector was ready to “outperform.”<\/p>\n\n\n\n
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Free Trading Resources<\/strong><\/p>\n

Have you checked out Jeff’s free trading resources on his website? It contains a selection of special reports, training videos, and a full trading glossary to help kickstart your trading career \u2013 at zero cost to you. Just click here<\/a> to check it out.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

At that point in January, GDX was trading for $30 per share and the S&P 500 was near 4800.<\/p>\n

Two months later, GDX was $39 and the S&P 500 was 4200. In just two months, the gold sector rallied 30% while the broad stock market fell nearly 13%.<\/p>\n

In other words, money came out of the overbought and overextended stock market and flowed into the beaten-down value stocks in the gold sector.<\/p>\n

Take another look at the blue arrow in August…<\/p>\n

\"Chart\"<\/div>\n

This arrow points to what could prove to be the first “higher low” in a new rally phase for the chart.<\/p>\n

It could be the first sign indicating the gold sector is ready to outperform.<\/p>\n

If that turns out to be the case, then two months from now the gold sector could be sharply higher while the broad stock market is much lower.<\/p>\n

Best regards and good trading,<\/p>\n\n\n
\"signature\"<\/td>\n<\/tr>\n<\/table>\n

Jeff Clark<\/p>\n

<\/p>\n

Reader Mailbag<\/strong><\/h2>\n

Where do you think the gold sector will be two months from now?<\/p>\n

Let us know your thoughts – and any questions you have – at feedback@jeffclarktrader.com<\/a>.<\/p>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

Two months from now, this sector could be sharply higher\u2026<\/p>\n","protected":false},"author":49,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ep_exclude_from_search":false,"service":"","footnotes":""},"categories":[1],"tags":[],"publication":[10],"person":[7],"newsletter-type":[],"ticker":[],"class_list":["post-20024","post","type-post","status-publish","format-standard","hentry","category-market-minute","publication-market-minute","person-jeff-clark"],"acf":[],"_links":{"self":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/20024","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/users\/49"}],"replies":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/comments?post=20024"}],"version-history":[{"count":0,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/20024\/revisions"}],"wp:attachment":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/media?parent=20024"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/categories?post=20024"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/tags?post=20024"},{"taxonomy":"publication","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/publication?post=20024"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/person?post=20024"},{"taxonomy":"newsletter-type","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/newsletter-type?post=20024"},{"taxonomy":"ticker","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/ticker?post=20024"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}