Avast Mateys! It’s time to strike the main sail and deploy the twin outboard Mercuries, as Her Majesty’s Treasure Frigate, The H.M.S. Dollar-Dollar Bill, is taking on water and listing amidships! Now is out time to pounce, Jag-you-are (sic) – style.
As I type, the dollar has broken below the crucial $82.00 “line o’ death” it’s been flirting with this last month, and fighting against even as all the stochastics began to show divergences marking an imminent change. I think that change is here, and provided we finish the day below $82.00 (we are at $81.94 right now), I think we should be clear to fly until at least $80.70, which is the long term 50% fibonacci. I do believe we should bounce then, just in time for a little September flattening while the dollar gets ready for a test of the 38.2% fib line down below $79.00. That should coincide with some nice seasonality for the precious, which always seems to be great offerings for the Turkey Gods, come November.
As I mentioned yesterday, I pushed the risk pedal with some AGQ, as silver was moving first. However, I think today is gold’s catch up day, so if you want to add to your NUGT for a brief period, I wouldn’t gainsay that additional leverage. As always, I recommend small and cautious with these instruments. If you are seeking less “muss & fuss,” GDXJ is probably our most oversold ETF, as it got cranked the hardest in the recent “junior miner recession” this Spring. It’s relatively overbought in the near term, but nonetheless a good bet to test it’s 200-day EMA here ($23.40) before pulling back.
A more speculative play is AUQ, which got trounced recently on bad numbers, but appears to be forming an island bottom on the daily chart, and has almost a full dollar gap to fill north of here. Of course, the landscape is littered with these plays, and some of far higher quality. Keep an eye on the 200-day EMA of gold bull index $HUI for a near-term guide. It’s next resistance (top right of a daily cup) coincides with that 200-day mark, at about $465, and that should provide the near term stand by.
Happy near-term buccaneering to you all, me mateys!