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Looking over my charts this evening (no shoulder devils or broken elevators), it seems that while the price of gold is doing the Heschel Walker down the field, the metal’s miners are lagging behind like a fat man with smoker’s hack. This gives me some pause and has me with my finger on the trigger. Despite minor wins today in AUQ, AUY and ANV, most miners that didn’t start with “A” were having trouble addressing the field. Moreover, silver struggled at the $40 line and gave it up by the end of the day. As a result, despite gold being up nicely, I was still down in my miner-saturated portfolio almost 2% overall today.
I’ve seen this play before (gold up, silver and PM miners lagging) and I don’t intend to stick around to see what comes of it again. I will likely sell some portions of my miners tomorrow morning and then hedge the rest with sold calls. I will also launch the remainder of my NUGT and DGP (what remains of them) even as I’ll likely hold on to my GLD and SLV positions for the duration,
I will then likely spin some of the newly raised cash into a few rebound stock positions to take advantage of a bounce I feel certain shall finally come tomorrow as we test the depths of 1090 and perhaps lower. I am again looking at QLD, TNA, EEM and possibly, quite possibly EDC again (very small ball!).
Be well and be wary, my friends.
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Futures are all green now ….
Keep your head on a swivel, Gentle Ben.
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That was, by far, the greatest thing that has ever happened in a soccer game.
It’s got my vote.
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It’s rally time ,.. I just got the all clear from a trader friend of mine:
“Still waiting for the crash all we have had is an appetizer “
LOL. Is this from your buddy who is always 100% wrong?
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He is very emotional and that gets exaggerated at highs & lows.
Real good article by Frank Barbera posted at zerohedge about how Mining stocks need to decouple from the equity market. Stated that they are not following the price of the metal and that they are following the equity herd down the drain. Sees slumping into the end of the year and a pop next year. Makes sense and would explain the recent action.
I think miners do de-couple from the equity market, but usually only in times when they are signalling that gold/silver are about to make a big move up.
I think in our current case, they are signalling that the move in gold and silver may be coming to a temporary halt.
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I expected gold/silver to disconnect, as gold is being used a lure to sucker the average investor into it. JPM has been pumping gold in the media.
The end goal is a govt (aka, central banker) gold confiscation, to support the new currency that the IMF and World Bank have been touting as replacement for the US dollar.
Always remember that the goal is maximum pain on the US middle class, for the purpose of wealth transfer, and you will never go wrong with your long-term plans.
I just don’t see gold confiscation as politically viable. You could start a revolution if gov’t got that grabby.
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If true, how would the confiscation work? Buy back at market rates and fines if you don’t turn in your gold? Wouldn’t silver become the next best PM by default? I haven’t researched it yet, but does anyone know how the gold confiscation was run in the 30s?
Gold was required to be turned in or one was fined and/or imprisoned for up to 10 years. The amount of FRNs in return for gold was fixed. After the confiscation, the govt greatly increased the price of gold. It also became illegal for the public to transact in gold bullion after that, for many years.
IMO, this next confiscation will be aimed at hording the actual metal in the hands of central bankers. They will then issue a digital form of gold which will become a fiat form of gold that the central bankers can inflate at will, thus stealing the wealth of the masses and ensuring they never rise above their place in society.
This digital gold will be used to gain the support of the public for a new world reserve currency. The new currency will be tied to carbon credits.
I’m as cynical as the next guy, but that shit is science fiction. The knowledge transfer quotient, thanks to electronic media is about 100,000x better than it was during the Depression, and people are far wealthier. There’s just no way anyone would stand for it, unless the gov’t were willing to risk mass secessions and internal rebellions. Too many people know what the Constitution says.
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Yes, you’re right. The miner’s strong starts were faded. I may follow you out.
JG,
I know your love MON but what are your feelings on MOS?
MOS is as oversold as anything, and you are probably coming into a decent cycle here, ag-wise. That said, it just bounced off the 200 week exponential moving average, so the low-risk play would be buy at these levels and place a stop a bit under that number ($58.47).
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EXK may be opportune here…. coming off oversold conditions and hitting some higher lows here.
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So are you holding off on the selling you mentioned in your post above to see what comes of this rally?
Yeah. I didn’t want to sell this morning into the downdraft, so I stuck around and held off. Ended up doing nothing but watching the whipsawing all day. One thing I noticed is that the miners climbed back even as gold and silver sold off… veddy interesting.
Now gold is back at $1760 again (7:40 EDT).
Go figgah.
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Gold was overbought before, but now it is WAY overbought. I held off on buying DZZ, but gonna pick some up tomorrow.
LOL. Make up your mind, son.
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What a day. My portfolios that I maintain in the hopes of retirement one day was returned to their former glory due to the late day surge and some opportune (read lucky) buys on Monday working on the theme of “buy when there is blood in the streets”.
I do not understand any of it. Watching, and reading about, the traders reaction following Monday, they all pretty much summed up the potential for Tuesday as, ‘we better get some fucking QE or we are drilling a hole through the floor’.
Today was mostly as expected. I cleaned up some buys on nice 24 hour price appreciation to lighten the load. Getting more cash rich as it were. Waiting for Dow 6K.
Then the Fed note came out. About what we expected: no QE. The market drops a bit. Oh shit. They say they are holding firm on the interest rates, basically slaughtering grandma’s CD’s, bonds and what was left of any interest bearing accounts. Awesome.
But then the magic happened. 500 points to the upside. Wheeeeee!. Europe is fucked? No problem. U.S. has unsustainable debts? No worries! Fed admitting to a basket case U.S. economy for the next two years? Who cares!?!? The only thing that is left is stocks. Lovely equities.
The boards and blogs went apeshit. Oh no! I’m not long enough. Gold is going to 1K. Hahaha! 14K is the target! Yippee! We don’t need no QE. -snort – ’bout time the Fed listened to the Tea Party.
Who knows what tomorrow brings. Think about the average retailer (like me). Hopefully they did mostly nothing or averaged down a bit (like me). But I bet many/most sold when it got bad. CNBC – 2008 – Fuck!. Now they will launch back into the market with what is left tomorrow for fear of missing the upside to 14K and will get slaughtered when we tail downward again after the Euro fucks deliver more unpleasantness (notice London burning?) sometime soon. Or maybe people will realize all is not great after all and the robots got it all wrong today.
I dunno. I wasn’t long enough today. But I doubt I will be emboldened anytime soon to get much longer than I am right now. And I look forward to collecting gold at 1K. I’m not trading this madness. I want to collect the tailings as it further declines. Dollah cost average into some beasts, mofos.
NFW gold goes back to $1k until this bull is over.
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JG any thoughts on NSU? they announce earnings tomorrow…2nd qtr of production at 1000oz a day cash cost about 300oz…may pick some up before earnings
No current thoughts. I’ll take a look tomorrow.
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thanks Jake….im very interested to hear your insight…btw earnings were announced this AM..right on target with my post above
Yea, but I wouldn’t mind it returning to the original (weekly) uptrend channel for purchase opportunities. This latest channel it appears to be forming makes me a nervous buyer. I think the bull has a couple of more years (at least?) FWIW, but what do I know? I was the dumbass that retreated to about 75% cash spread among my various retirement vehicles before the massive rally.
What is with this idiot claiming that gold will ever hit $1000 again. Let me tell you something, there is no way gold will ever be $1000 in today’s currency. Eventually it will be worth $1000 or much less in the new dollar that is introduced after this one completely blows up.
I like DZZ very short term, but am a complete gold bull longer term.