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Bang! Bang! Maxwell’s Silver Hammer

I was beaten like a silver gong today, and Mr. Market is telling me in not so polite terms that I’d better get the hood up on the convertible before he starts raining golf ball sized hail on my head.

I’ve been busy here so I don’t have a ton of time for comment, but suffice it to say, until further notice, we are in bunker mode.  That means I will be hedging the JCHP with double and treble ETF’s in order to make up for any downward motion in the silver and gold plays.  As well, I may either cut back severely, or totally eliminate certain positions.  

Natural Resource Partners LP [[NRP]] is an example.    I am keeping it right now, even though it is down more than 10% since inception because it carries a high dividend yield (almost 9% at inception, higher now).  However, I may get rid of it if it dumps below $20.   I may also take this opportunity to lard on some [[SMN]] or other appropriate short shields.   I will definitely add [[TZA]] — the triple short small cap —  at the open for instance, since I bot some just before the close today for my own portfolio ($24.92

I think we’ll probably get a bit of a bounce tomorrow, and I’ll be taking that opportunity to move into cash and some hedges, as I don’t think this is over.  If it’s just a short term blip, so be it.   We can scale back in when the ground is safer.   In the meantime, protecting principal (and gains) will be the paramount idea. 

I’ll update the JCHP later tonight.

Update:  One thing to keep in mind is that the US Gubb’mint needs to sell over $100 billion in bonds this week.  You think there might be a reason to jack the price of Treasuries [[TLT]] for such selling purposes?  Remember, Goldman sells these things for them.

Update: Here’s yesterday’s ugly Jacksonians.  I just picked up some TZA @ 24.85 (yes, lower than yesterday’s entry) for insurance:

Name 19-Jun 22-Jun % Change   Comments
ANDE  $ 28.61  $   28.45 -0.56%   Spent most of the session up
EGO       8.20         7.65 -6.71%   Broke $8 support, next at $7.19
GDX     38.39       35.74 -6.90%   Broke TL barely, needs to get back to 36.75
GLD     91.90       90.54 -1.48%   Also broke TL, needs to see over $91.50 
IAG       9.36         9.04 -3.42%   Also beneath TL, needs $9.35
MON     80.73       78.12 -3.23%   Still on trend, needs to stay over $78.
NRP     21.99       20.60 -6.32%   Sell below $20.00  
PAAS     18.93       18.02 -4.81%   Least banged up silver today, still above TL
RGLD     43.08       41.12 -4.55%   Still above TL, 38.2% fib @ $39.50
SLV     13.99       13.54 -3.22%   Still above TL til $12.87
SLW       8.63         7.97 -7.65%   Right on long term TL today, gotta bounce here.
SSRI     18.92       17.56 -7.19%   Still on long term TL til 16.50, could get there.
TBT     54.34       53.28 -1.95%   Could easily get back to 49.25 before bounce.
TC     10.54         9.40 -10.82%   Sell all on a break of $9.25, 1/2 on gap fill 10.38
TCK     16.54       14.57 -11.91%   Sell below 14.35, long term TL @ $12.50
AVG (daily)     -5.38%    
AVG (monthly)   -12.15%    
AVG (inception)   9.39%    
Cash ( 000’s)  $       4.61    

UPDATE: The following astounding link should be clicked by all.   Keep in mind that The POTUS just asked that the Fed be put in charge of MORE of our financial system, and then watch this.

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Juniors to Watch

[[AZK]] – big buy at EOD on Friday — over 20% of the day’s stock traded in the last 30 minutes.

[[CDE]] – Very high volume (over four times average) white doji after ten (!) red down days in a row.  Bears watching.

[[DROOY]] — 29% of all trading in one five minute period on Friday (3:50-:55) drove the stock up 43 cents (5%).

[[EGO]] This Jackson pick also had almost three times volume on Friday.  Strong into close until last five minutes, with a massive sell stick.  Ended with an inverted (white) hammer, volume indicating bottoming.

[[FRG]] Could get interesting over $4.21  — handle breakout?  Also, E8’s possible AEM buyout pick.

[[GRS]] Could be a short here, on a break of $6.90.  Weird EOD activity on Friday.

[[IAG]] Again, almost 3x normal volume on an up day for this Jackson, but massive last ten minute red candles give pause (1.4 mm shares out of 9mm total).

[[NGD]] Another that looks great on the daily chart, but then that last five minute plunge gives one pause.   Breaking out up til then — could’ve been opex.  Looking for handle breakout here.

[[NXG]] Massive volume white doji, but last ten minutes blood red too.  Still on trend.

[[RBY]] Maybe the best pick of the day, breaking to new all time highs on Friday.  STILL had EOD selling the last ten minutes!  What was going on?   I guess we’ll see soon enough…

Developing…

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Week’s End Respite

Lot’s of comments,  and I’ve annotated some charts, but I don’t have time to fill in the commentary yet, so I’ll just throw the charts out for now.   Many of them are self explanatory… “developing…”

Markets via the Transports, daily:

tran_daily

And weekly, with the Fibs:

tran_weekly

 

 

Now our $HUI— daily:

hui_daily1

And the weekly $HUI:

hui_weekly

Last, the Jacksonian Results as of Friday:

Name 18-Jun 19-Jun % Change   Comments
ANDE  $   28.18  $    28.61 1.53%   Still in consolidation here. Break now $28.15
EGO         7.97          8.20 2.89%   Support @ 8, bizarre final 1/2 hour.
GDX       37.20        38.39 3.20%   Nice EOD action.
GLD       91.60        91.90 0.33%   POG flat, like all week.
IAG         9.10          9.36 2.86%   Never got below $9.  Odd last ten minutes
MON       82.30        80.73 -1.91%   A pox on Cramer. Nice final 45 min.
NRP       21.95        21.99 0.18%   Back above trend for now.
PAAS       18.59        18.93 1.83%   Nice volume today.
RGLD       41.98        43.08 2.62%   Still on trend.
SLV       13.97        13.99 0.14%   POSilver @14.23, inside day
SLW         8.30          8.63 3.98%   Triangle forming, up off the floor?
SSRI       18.13        18.92 4.36%   Nice move, but EOD red candles again.
TBT       55.76        54.34 -2.55%   Not yet filled gap @ 54.20 yet.
TC       10.50        10.54 0.38%   Flat again.   Watch for break.
TCK       16.28        16.54 1.60%   Consolidating.
AVG (daily)   1.43%    
AVG (monthly)   -7.15%    
AVG (inception)   15.55%    
Cash ( 000’s)  $       4.61    

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Hammered by My Hammers

Sheesh, I sure am glad I put that caveat in there yesterday, because all those nice high topped hammers I saw yesterday did nothing but crash off my dome all day long today.  Let’s face it, I’m starting to get a little tired of this pullback (down over 9% this month!), m’self, and even more so given the relative reasonableness of today’s market on the specifically non-Jacksonian financial sector today.  Talk about a victory for the bloody Redcoats!

That said, I haven’t stopped picking up shares in various stocks that I consider bargains at these prices.  I’m just flabbergasted at how low ((SSRI)) and ((PAAS)) and ((SLW)) have gotten.  I bot more SSRI yesterday, and got another 2k of SLW today (at $8.26 on the gap fill), so I guess tomorrow is PAAS’s day?

For those of you who have been accumulating slowly here, bravo.  The Jacksonian Portfolio is defintely a Spartan marathon and not a dash to the corner deli for a pack of Kools and a pint of Sunny Delight.   This “bucking bull” volatility is going to be here for the duration,  so we’re going to have to “get in shape” by taking some cash off the table from time to time, like I did with ((TC)) the other day.  

As you may recall, that 1/3 TC sale and the liquidation of the original TSO position left me with some $14,607 in cash from the original portfolio.   I finally decided to put the bulk of that to work with an initial $10k position in ((TCK)), as we’ve contemplated.  It didn’t hurt that TCK was having a good day, let me tell you.  Now I have $4.6 k left in cash, and soon I’ll begin incorporating the cash component into the overall returns as well.   It doesn’t make any sense to take profits and then not incorporate that into the total return of the portfolio. 

As well, I’ve decided to be a bit more “illustrative” in this account by dealing with hedging in a different way than I do in my personal account.   As it’s too complex (and annoying)  to incorporate the short calls I usually use to hedge my portfolio, I will more simply sell portions (or all) of the  Jacksonians in order to accrue cash in the portfolio and take risk off the table.   I think that will probably be easier for you all to follow as well.   Your comments are welcome. 

I haven’t much in the way of commentary on the Jacksons today other than my notes below.  I will say that we continue to be brutally oversold, and we are due for a cycle low here in the precious metals any day now.  I continue to believe you will be rewarded for your perseverance here. 

Because I felt bad about all these bloody Jacksons (save TCK) I figured I’d dig up one “present” for tomorrow… a non-Jacksonian I did the fibs on tonight is [[MTL]] — Mechel OAO.  Coking coal, steel, molybdenum, it’s got it all.   I like it because it touched beautifully off the23.6%  intermediate term fibonacci line today and it looks like it’s ready to go again.    The other one I like for tomorrow we’ve already discussed… PPT favorite [[SPAR]].  Best to you all.

Name 17-Jun 18-Jun % Change   Comments
ANDE  $   28.88  $     28.18 -2.42%   Will sell half on a break of $28.  Gap fill at $26.60
EGO         8.65           7.97 -7.86%   Trend line @ 7.78.  Bearish engulfing says we get it.
GDX       38.23         37.20 -2.69%   Failed hammer, back to support.
GLD       92.35         91.60 -0.81%   POG $934, within yest range
IAG         9.65           9.10 -5.70%   Sell 1/2 on break of support @ 8.75
MON       81.08         82.30 1.50%   Cramer beat it up tonight, a net positive.
NRP       22.13         21.95 -0.81%   5 red days in a row? C’mon already!
PAAS       20.39         18.59 -8.83%   Uptrend line at 17.95. Pssin me off.
RGLD       43.73         41.98 -4.00%   Hammer doji on trendline, EOD buying
SLV       14.12         13.97 -1.06%   POSilver @14.24, inside day
SLW         8.80           8.30 -5.68%   Filled that last gap at $8.27, bot 2k more $8.26
SSRI       19.22         18.13 -5.67%   Do not like this action one bit.
TBT       54.17         55.76 2.94%   Gap @ 54.21.  Could come back once more.
TC       10.50         10.50 0.00%   Perfect doji day.
TCK       15.31         16.28 6.34%   Nice first day on the job.
AVG (daily)   -2.32%    
AVG (monthly)   -8.32%    
AVG (inception)   13.91%    
Cash ( 000’s)  $       4.61    

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These Fibs Don’t Lie

Well it was a day so full of hammers in the Jacksonian portfolio that we could have built a break front works that would have repelled the stoutest of cavalries.  You can see my comments in the notes about them, but generally a lot of hammers means that you are seeing final bottomings in stocks as they open high, chase a bunch of sells lower and then close high again, working out final selling positions.

I say this happens “generally,” but we shall see what happens tomorrow.    The good news is we’ve gotten to pretty oversold conditions in almost all of the Jacksons, so those of you who have been picking up bargainst these last few days, bravo.   I think we shall see some action as we head towards the end of the week.   As it’s options expiry, I hope it’s not that X-rated kind of action no sensible gentleperson wants to see.

I was doing some work on fibs, but I have to run to a lacrosse game, so my findings will have to wait until an addenda is readied with my findings.   Let’s just say these ten year fibonaccis are, in the words of Commander Spock “Quite fascinating, Jim.”

Many apologies to those not named Jim.

Here are the “notes,”  I will talk to youse latah.

Name 16-Jun % Change 17-Jun % Change   Comments
ANDE  $ 29.04    $ 28.88 -0.55%   Still in triangle consolidation.
EGO       8.51         8.65 1.65%   Bullish engulfing, two days black now.
GDX     38.37       38.23 -0.36%   Nice hammer on the day, despite slight down.
GLD     91.93       92.35 0.46%   POG $940, beautiful hammer.
IAG       9.54         9.65 1.15%   Hammer off the 23.6% fib, too.
MON     81.62       81.08 -0.66%   Opened down, nice recovery.
NRP     22.44       22.13 -1.38%   Red hammer just above the 38.2% (22.05)
PAAS     20.74       20.39 -1.69%   Held support at $20, oversold like a mothah!
RGLD     42.90       43.73 1.93%   Bouncing on 43.50, another EOD selloff?
SLV     13.99       14.12 0.93%   POSilver @14.34, $13.80 support held
SLW       8.92         8.80 -1.35%   Hammer on $8.50 support, nice trade PPT!
SSRI     19.62       19.22 -2.04%   I bot it one last time as promised! $19.02.
TBT     53.59       54.17 1.08%   Bot back 1/2 my calls today as promised.
TC     10.68       10.50 -1.69%   Caught support @ 9.60 and then took off. Hammer.
TSO     14.98       14.98 0.00%   Is TCK the replacement, let’s hear your vote!
AVG (daily)     -0.17%    
AVG (monthly)     -7.44%    
AVG (inception)   16.22%    

______________________________

PS — note the final comment on TSO, which goes away soon.  I am seriously thinking of adding [[TCK]] which I added today at $15.04, to the Jacksons.   It’s only serious competition is [[BHP]].  What say youse?

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Just Remember that it’s an Illusion

Catch hold of this reflationary bounce here, but don’t be surprised when it all starts falling apart again.  It may be this summer and it may be next, but the bear will be back, no question.   Right now, the soporific falling dollar keeps him at bay. 

I’ve got a great paper for you all to take in at your leisure, written by economist and author Antal Fekete, professor at the San Francisco School of Economics.   Below is an excerpt from his lecture, Fiat Money in Death Throes.  (click link for whole paper).  

This particular segment shows why we have no choice but to arm ourselves with sound money alternates, as the “drug addicts” will brook no change until they are forced into withdrawl.

A government can take total control of the people either by the use of military force, or by

the use of irredeemable currency. The former is readily understood, while the latter is a subtle

national drug that is not generally recognized as such. Rather, it is readily embraced by its

victims. For these and similar reasons irredeemable currency is the favorite device of modern

governments that want to bring people under total control. Indeed, it enables the government to

succeed in controlling the masses while, at the same time, earning their approval and even their

enthusiastic support. Irredeemable currency must be seen as the habit-forming drug that the

government uses to intoxicate people. Under this intoxication people will want more and more

national spending, more and more government control, and more and more debt.

 

This intoxication obscures the sad end that arrives when the merry-go-round is coming to a

jerky halt, when credit is exhausted or withdrawn, and the kitty is found empty. The nation is

facing a most serious economic disaster followed by prolonged economic pain. Unfortunately

government economists, university professors, and financial journalists have taken their share

of the fun and they failed miserably in their duty to forewarn people of the coming disaster.

 

It is useless to expect a mass movement on behalf of a sound currency. The daily

experiences of people provide them with a warped outlook. They confirm in their minds the

alleged virtues and benefits of an infinitely inflatable currency. People lack sufficient

understanding of monetary science to see that no currency can be made infinitely inflatable

without inviting disaster. Like a drug addict, people exposed to irredeemable currency do not

regard it as a dangerous and undermining narcotic agent. Even the loss of purchasing power

does not disturb them to any great extent. Their response is to demand more money, and they

take pride in the fact that the government listens sympathetically to their demand. They

welcome the soaring stock indexes and real estate prices, and put great stores on them. Heavy

taxes and burgeoning debt are not regarded with anxiety. A frequent and common agitation is

for ever more government spending.

Sound familiar yet?   Welcome next, “Obamacare”…. My best to you all.

 

 

 

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