It is no surprise after such a strong run that, we see a correction in the gold price. It is healthy market action.
The biggest question is how far down will the correction take us. My plan is to add another one or two gold stocks to our list on this correction.
It is hard to say how far gold will pull back. The chart shows a doji star reversal pattern, but as I have commented many times, candle sticks are not reliable on a continuously traded instrument. Opening and closing prices are very important with candle sticks, so what I look at is the prices around 9 am as the open and the closing price around 5 pm. That does not show a doji candle but a small green candle, a little smaller than the far right green candle. It still is a reversal pattern, but not as strong as the doji reversal. That said, RSI hit 80, which is an overbought reading as well.
There will be a correction to some level. The most bullish case is mild support holds around $2160, and a bigger correction would be into the $2100 to $2120. That is what I expect because the market has been so bearish it will probably not change quickly. But one never knows. I have no doubt we are in a new bullish move, but patience may still be required.
The gold stocks, measured by the HUI rallied about 17% a lot better than gold's 7% rally, so that leverage was good to see. However, the gold stock move was muted and still weak. The HUI, around 235, still has a long way to go before reaching 280 last May when gold went to the $2140 area. Near term we need to see a higher high close at 260 or better.
AI The Next Big Thing
On February 21st, I thought Nvidia's (NVDA:NASDAQ) — NVDA stock price was ahead of itself, and we would see a further pullback. That did not happen, and instead, the stock ran from $750 to $950 in the next few weeks. It is a telling sign of how strong this AI craze is.
However, it is really a big thing and goes far beyond Nvidia, so in time, AI will be recognized in 100s of companies. Think back to the internet boom, it started small, too, but it evolved into way more than just seven stocks or so and ended up being 100s. We are beginning to see news on AI in numerous places, and after all, AI has already been around for a long time but is just now getting wings because of the advancement in computer power.
IBM announced job cuts in its marketing and communications team on Tuesday. The move is part of IBM's ongoing shift towards AI, highlighted by CEO Arvind Krishna's efforts to upgrade employee AI skills significantly. This follows an earlier decision to replace nearly 8,000 jobs with AI and a reduction of 3,900 positions last year. Remember, decades back, IBM's deep blue AI could only manage a chess game. AI will displace millions of human jobs in many industries. It will be most interesting to see how the economy and job market evolves.
Jackpot Digital is the Best AI stock in Gambling/Casinos
Recent Price – CA$0.06
Jackpot Digital Inc. (JJ:TSX.V; JPOTF:OTCQB;LVH1:FSE) is ridiculously cheap for how far it has advanced. Some of you may remember Jackpot. It started putting its AI poker tables on cruise ships before COVID-19. The cruise ship industry was among or probably the hardest hit industry by COVID lockdowns. Over 50% of startups and small businesses did not survive the government lockdowns, and I thought Jackpot would be one of those, so I suggested selling.
However, Jackpot survived, and not only that has come out a shining knight. This speaks volumes about the company's ability to survive COVID and the lockdowns. Small companies don't have the resources like big companies to survive major set backs. Jackpot has moved far beyond the cruise ships now. In addition to Jackpot's cruise ship customers, which include Carnival Cruises, Virgin Voyages, Princess Cruises, Holland America, AIDA, and Costa Cruises, Jackpot has announced land-based installations or orders in 12 states and territories in the United States and growing, including California, Kansas, Louisiana, Michigan, Minnesota, Mississippi, Montana, Nevada, Oregon, South Dakota, U.S. Virgin Islands, Washington, as well as several international jurisdictions.
Most recently, on February 13, Jackpot signed a licensing agreement to install Jackpot Blitz dealerless multiplayer electronic poker table at the Acropolis Gaming Lounge, located in Kingston, Jamaica, further expanding its growing Jackpot Blitz casino footprint. The company has already obtained the required certifications for the jurisdiction and is now scheduling installation at the property.
Jackpot now has 80 tables installed and will soon be 100. Each table brings in approximately $3k in revenue each month. This solution for casinos is far more efficient, saves costs and staffing problems, and is loads of fun to play. I believe Jackpot is reaching an inflection point with a decent base now and strong growth to propel it to the next level. I believe we will see numerous new sales agreements in the coming weeks and months. The stock won't stay at these prices long.
I strongly recommend you watch this video on Jackpot Blitz by Jimmy Johnson, who is of NFL fame. You will get all the key points in two minutes.
In 2021, the market size of the casino and online gambling industry worldwide reached a total of US$231 billion.
The global gambling market is expected to reach US$912 billion by 2027.
The drop in 2020 with lockdowns is no surprise, but the recovery is a surprise and very strong. We have not seen this kind of growth since the mid-2000s. This is a strong backdrop for Jackpot.
The stock has built a strong base of between 6 and 8 cents, so I see little downside. Once it breaks the first resistance around 10 cents, it can quickly move into the $0.20s.
Because this is a cheap stock and totally unknown, I will not put it in my substack newsletter until Thursday afternoon.
Jackpot Digital is an advertiser at playstocks.net, and I own shares.
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