(Thanks to ‘Shed for the family photo)
As expected, the miners have begun to consolidate a bit of last week’s (and last month’s) run up. Nothing major mind you, but the $HUI tells the tale here. Remember this weekly chart from the 22nd of May?
A little more than a week later, the $HUI is behaving as indicated. Remember that red line — the “likely target for a short rest?” Here’s today’s same chart:
This wholly expected retrace may bring us as far back as the top of our “consolidation box” ($375-ish). But if the dollar and the 10-year continue to exhibit problems, I shouldn’t expect this rest to last much longer than that. I will be using this time to aggregate some names like [[GG]] and [[AUY]] that I’ve been looking to add. Those of you who have been waiting for a Jacksonian entry may want to consider this week’s opportunity as well.
One other thing, I’ve been thinking about water as an appreciating commodity recently, and many of the water-related stocks have begun setting up nicely. I may take a shot at grabbing some of the desalinator [[CWCO]] tomorrow if the stars are properly aligned.
Note the new “comments” section on the JCHP performance chart. Innovative, no?
Best to you all.
| Name | 1-Jun | % Change | Comments | ||||||
| ANDE | $ 26.00 | 3.59% | Moving with the Ags | ||||||
| EGO | 9.69 | -2.32% | Accumulation opp. Here | ||||||
| GDX | 43.41 | -1.70% | $HUI pullback | ||||||
| GLD | 95.73 | -0.49% | Resting for the leap to one grand? | ||||||
| IAG | 11.02 | -2.22% | Friday’s gap @ $10.92 | ||||||
| MON | 81.48 | -0.82% | Yet to fill gap @ $85.06, Barron’s mention ↑ | ||||||
| NRP | 24.24 | 2.45% | Low volume up day, KOL up big | ||||||
| PAAS | 23.39 | -0.13% | Still very much in uptrend channel | ||||||
| RGLD | 46.14 | -0.92% | Half volume day, pullback | ||||||
| SLV | 15.35 | -0.78% | Friday’s gap @ $15.06 | ||||||
| SLW | 10.49 | -0.29% | Friday’s gap @ $9.99, will it get there? | ||||||
| SSRI | 24.30 | 1.72% | “Indefatiguable”, Friday gap @ $23.26 | ||||||
| TBT | 55.52 | 5.47% | Gapped up, strong volume day | ||||||
| TC | 9.99 | 4.06% | Gapped up today, didn’t fill. | ||||||
| TSO | 17.51 | 3.36% | Hugging the top of the triangle, must break $17.80 | ||||||
| AVG | 0.73% | ||||||||
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BTW — TC had a decent day, but titanium did better. both TIE and RTI were BTFO today.
Someone was asking about TIE at one point…
Gone like Latro in the Mist…
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http://www.reuters.com/article/GCA-GreenBusiness/idUSTRE5505JH20090601
^^^^^^^^^^
Luddites.
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http://rense.com/1.imagesH/farmer3_dees.jpg
LOL — gotta like the sky trails above for the “just right” paranoid touch.
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Not the coal miners!! go ACI
(Thanks to ‘Shed for the family photo)
Holy shit – that was wrong as 2 boys kissing.
Jake,
I’ve liked silver better than gold for a while but as I already have full positions in SLV and several of the Jacksonian miners, I am looking to start building a gold position on this pullback/rest stop. Would you suggest starting with GLD or with the miners?
Thanks for adding the comments section. It makes an excellent addition to the performance chart.
PCX has been much weaker than other coal stocks such as MEE and WLT. I do not think I would chase MEE or WLT.
BTW Good analysis and charts!
The gold and silver miners rested their weary bones today but their doughty compatriots mining base metals didn’t rest. VALE, BHP, Fortescue (FSUMF) etc. did very nicely as did BDD on the pure base metal play. Lately it seems that precious metals, base metals, and energy will see two of those three sectors up on any one day. Makes for a nice balance. Ag commodities look set to start up as well as RJA broke out nicely today.
Also, some of you may want to look at CEF. It is 80% gold/20% silver ETF similar to GLD and SLV but older and based in Canada.
Yeah PCX looks good.
Remember, NRP has a dividend too, so less volatile than those screamers.
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Sleepy, I like to start with the basics- physical and GLD first, then the miners and the royalty plays. The latter is a but overbought right now, so you may want to price some Maple Leafs, just spread out your purchases in case there’s a cheaper price coming. I don’t think it’ll get much cheaper though. Your first market purchase after GLD should be RGLD. Then EGO and IAG.
From there you will have a number of choices, but GDX (the ETF) makes a great catchall.
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Funny I owned CEF for years before SLV and GLD came out. Still have a little bit in one of my IRA’s but moved most of it to pure play land.
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Thanks Jake. I haven’t taken the time to understand the royalty plays so I’ll stick to the other options. Plenty there to choose from.
Great daily analysis and insight into the Jacksonian portfolio holdings keep up the great work Jake, much appreciated.
Thanks Milan. I’m glad you’ve found some of this helpful.
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Kel- your post above was very helpful particularly your observation about 2 or the 3 sectors being up at a time. And also thanks for noting RJA’s breakout today. Missed that.
Jake–love your blog. You’re doing a GREAT job.
Jake,
If you had not noticed, the 61.8 Fib retrace lays around 380.
Could be an imaginary line, or some support.
Jake here is one right for your portfolio. Buffett bought 20% BYD company BYDDF.PK . I cant get access to it. Can you
BYD deals with two businesses: IT manufacturing and auto manufacturing. It has production bases in several large Chinese manufacturing centers as well as in Japan, Korea, Taiwan and various emerging markets (such as Hungary and India). It is a public company and is listed on both the Chinese and Hong Kong stock exchanges. According to a Harvard Business School case study on BYD (required reading, in my opinion, if you really wish to understand Buffett’s interest in the company), the company opened up shop in 1995 and by 2002 became the world’s second largest manufacturer of rechargeable batteries. This was considered a remarkable feat because battery manufacturing was traditionally viewed as a capital intensive business that required large expenditures on things like robotic arms and dry rooms. Chinese companies’ comparative advantage was always thought to be their access to a large supply of cheap labor and so it was assumed that no Chinese company would be able to compete in the battery business. However, BYD was able to become a low cost producer of rechargeable batteries by changing the manufacturing process such that labor became a much larger input and capital equipment became a much smaller input.
Wow, the market didn’t give us much time to go bargain hunting. That was a pretty period of consolidation… 🙂
If you had not noticed, the 61.8 Fib retrace lays around 380.
Could be an imaginary line, or some support.
Anon — yes, I’ve got the 61.8% long term (2 year) $HUI fib line at 378.50-ish. Lots of support there… if it gets back to it!
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NG going bonkers, up 11.5%.
I hope you guys are watching this stuff… these markets only do this kind of action once a cycle or so.
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MP — looks fairly liquid for a pink sheet company (over 600,000 shares traded thus far today), but I’m not going to get overly excited about a company that is “well positioned for cap & trade” as it may never happen.
Which may be a good thing for the economy.
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Hey Jake, do you think EGO will hold this 9.88 level? Looking to enter.
Jake,
Just a heads up in case you didn’t notice my peanut gallery post I posted today, but I put up a new option strangle play on the SPY last week. This looks like a good spot to play a strangle. I can make a strong argument for why the market will continuing rallying here but I can make a similarly strong argument for why the market may get week and trade down for a while too… good place for a strangle.
Phil, sorry I missed this, yes I think you’re safe at 9.88, and you may see a bit more consolidation here.
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Caveman –Good place for a short, too!
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