Huge buying in gold miners at close ABX, GG, NEM

  

  Frank Holmes: When It Comes To Gold, Stick To The Facts

Rob McEwen: People Will Return To Gold - Will They Return To McEwen Mining? MUX, TNR.v

"Nobody likes to ride the roller coaster which you see on the chart above. Nobody loves Gold any more, "economy is improving", "there is no place for Gold in expanding economic phase" and All Junior Miners are Slaughtered. We have the perfect set up for the new Bull Leg up in Gold and, particularly, in junior miners. Not everybody will survive, only those who have real assets, teams and shareholders backing them will prosper again."

  In our search for the Bottom for the Gold and Gold Miners we have found the news below quite interesting:

Huge buying in gold miners at close

By Chris McKhann (chris.mckhann@optionmonster.com) | optionMONSTER – Thu, Feb 21, 2013

A trader jumped into an enormous number of out-of-the-money calls in gold miners right before the session closed yesterday.

optionMONSTER's Heat Seeker system shows that the three largest option prints of the day came in the final 3 minutes of trade in three names. A trader bought 250,000 January 90 calls in Barrick Gold for their ask price of $0.07. A minute later, he or she bought 156,312 January 80 calls in Goldcorp for the ask price of $0.10. And a minute after that, the same trader purchased 200,000 January 90 calls in Newmont Mining for their ask price $0.10.

The open interest at each of strike was under 5,000 contracts, so these are clearly new purchases. The delta of these options was 0.01 in all three, meaning that they have a 1 percent probability or less of finishing in the money at expiration in about 11 months. So these are relatively cheap bets on these stocks, but the total cost of the long calls is more than $5.3 million--no small change, especially given the very small probability of profit. (See our Education section)

Shares of all three names fell sharply yesterday, with ABX and GG down just under 4 percent and NEM down 5.45 percent. ABX and NEM hit new 52-week lows, while GG was just above July levels. The all-time highs for these stocks came in the fourth quarter of 2011, with ABX and GG around $56 while NEM was just over $72.

It would be a vast understatement to call this an unusual option trade. I have never seen anything like it. "

Gold: So much effort to show how it is Weak.

Next week will be very important. Will Gold perform Bullish Head and Shoulder Reversal pattern with LS at 777.70, Head at 739.8 and RS above 750? If the market will rally further into election after painted not without PPT help a Double Bottom reversal and public will listen to Mr Buffet, Treasuries will continue their bleeding and US Dollar will go down from its recent high. Gold is still holding the best in a recent financial melt down and at least part of the money will be allocated to its real safe Heaven status.

On another hand even Major Producers are beaten into the ground with General Equities as their is no tomorrow. They are screaming Buy if the Gold will hold at its Reversal.

If you Buy this theory GDX will be the best choice without stock picking efforts, othervise biggest in the sector Barrick Gold ABX and Newmont NEM will get attention first, Yamana Gold AUY is highly leveraged to copper recovery on Inflation Play in Americas.

Market will be surprised in this scenario by earnings Power of Gold producers now: Gold is holding well and all other cost base commodities with the most important OIL went down. Companies should show great margins from this last Q of operations.

Once it will show some life greed will come back into sector and the the only supply of Reserves will come into play - Juniors which are given for free right now like TNR Gold TNR.v and Bravo Venture BVG.v.

Newmont Mining NEM is flying today

Calls NEM 45 Jan o8 is Up another 80% today.

This is called leverage to the Gold Price:

"8:35AM Newmont Mining beats by $0.47, beats on revs (NEM) 46.44 : Reports Q3 (Sep) earnings from continuing operations of $0.72 per share, $0.47 better than the Reuters Estimates consensus of $0.25; revenues rose 49.4% year/year to $1.65 bln vs the $1.41 bln consensus. Co is narrowing outlook for equity gold sales to between 5.2 and 5.4 million ounces at costs applicable to sales of between $400 and $430 per ounce for 2007. "

"APNewmont Mining 3Q Earnings Double"


http://biz.yahoo.com/ap/071031/earns_newmont_mining_corp.html?.v=3

The most comprehensive comment on recent Markets. Gold, Silver, USD collapse, Subprime.

http://www.sprott.com/pdf/marketsataglance/09-2007.pdf

I am ready to delete this post immediately should Sprott consider it is in breach of their copyright.