[youtube:http://www.youtube.com/watch?v=pwkpfSMOyXU 450 300]
A Fistful of Awesome!
_________________________________
Yep, I went and did it again today. I didn’t like the pin action in the price of gold, not to mention the dollar, and so hedged most of my major positions, including SLW, ANV, EGO and RGLD, with short calls, just slightly in the money, one month out (Novembers).
I also trimmed my AGQ once again, selling another 400 shares at $104+. I now have only a measly 400 shares left from my original 3,000. We are retardedly over the 200 day moving average in silver, which just refuses to stand down, but AGQ will be a hard break when it does finally succumb to gravity, I’d contend.
The good I see ahead is in the precious metals, big surprise, no? That’s why I’m only shorting calls, rather than selling big chunks, though I did sell 30% of EXK yesterday, instead of selling the calls. At prices below $5, however, and really even below $10, I see there being little difference in the price of a call, and the price of a stock, so I just sell the underlying to a point where I’m comfortable holding through the storm, and then I just hang on.
The bad I saw today, was in the bank stocks. I thought at first that this mortgage gig was a smokescreen, readied by The Powers That Are to scare some valuations down for coming bank M&A’s. That thesis may still be correuct, but I was given pause by the action of the bank index ($BKX) today. Observe:
After all this hooplah since early September, you’d think the financials would have something better to show us than the above, no? And yet, it’s looking bad for now. I shall revisit my “possible takeover” thesis later in the year, as I still believe there’s a strong percentage still in betting on a flurry of acquisitions coming off at the end of this year.
In the meantime, I dumped the last of my BBT, FITB and even JPM. I may buy back one of those after this storm has passed here, but for now, cash is better than banks.
The ugly is none other than the mighty U.S. dollar, which seemed to get it’s bounce today, off the $76.40 low area and is now almost 30 cent higher at $76.70.
This bounce should give you an opportunity to consolidate some positions, and perhaps enter others. I have my eye on more GSS, which is one of the few gold and silver plays that is not yet overbought. But be ready to pounce with all alacrity on the whole universe, as this pullback may be short lived.
Or, not lived at all.
My best to you.
____________________
Comments »