Could Gold Miners Crash Like March 2020?

All of the most accurate gold indicators that are right 100% of the time are telling us that gold will be trading significantly higher one year from now, and if so, gold stocks will be the market's top performers over the next 12 months... but there are no accurate indicators to determine where exactly gold will be trading one week from now or one month from now, and because the overall stock market is about to crash... people are afraid to buy gold stocks at this very moment because they believe a crashing stock market would also take gold stocks down with it.

The most important thing is to never buy gold stocks on leverage and to always keep capital available to buy more shares on dips. If you own GDX, GDXJ, or individual gold stocks without any leverage and don't have any risk of being forced to liquidate, and you have capital available to buy more shares... you should be hoping for a crash to take place. The March 2020 crash was followed by gold hitting a new all-time high five months later. From their March 2020 lows to August 2020 highs, GDX gained 2.83X higher and GDXJ gained 3.38X higher, while the highest quality gold stocks gained 5X-10X higher.

The big difference between now and February/March 2020 is this...

Everybody right now is expecting a crash to take place in gold stocks and sentiment is near the most bearish in history! Nobody was expecting it back then! Gold stock sentiment was overwhelmingly bullish in February 2020!

On February 21, 2020, investors owned $1.633 billion worth of NUGT (the 2X leverage GDX ETF) and $1.212 billion worth of JNUG (the 2X leverage GDXJ ETF). Today, investors own only $445.87 million worth of NUGT and $280.25 million worth of JNUG.

Investors owned 3.66X more NUGT on February 21, 2020 than today. Investors owned 4.32X more JNUG on February 21, 2020 than today. Current ownership of NUGT and JNUG are near their lowest levels in history!