Yesterday saw MM trim our SFR position in accordance with our mildly bullish short-term outlook towards the $US however its important to note we have only migrated from being very overweight to market weight affording us the flexibility to load back up on the likes of BHP, South32 and AWC if/when we do see a dip by the influential sector. The strong correlation between gold and the $US is unquestionable and it suggests that if we see a 5% bounce in the $US then gold could easily pullback $US100/oz but the million dollar question is how far will the gold stocks fall especially as we remember they’re still cheap compared to much of the ASX and other local miners.
- One of our core views for 2023 is that the Resources Sector will outperform although most of the gains are likely in the 2nd half of the year.
However, it’s important to recognise that when strong bullish trends unfold they often surprise on the upside providing investors with few easy/cheap opportunities to enter, or potentially re-enter in our case if we attempt to get “too clever”.
MM is very bullish on gold medium/long term
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