Sun, Sun, Sun, Here He Comes…
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Today was golden, metaphorically and physically.  Aye, my purse weighs heavy tonight, good sir. They’ll be more to come, but let’s see what today’s action meant for one of favourite picks.  Today, I examine the daily Allied Nevada Gold Corp. [[ANV]] chart for some near term lessons and targets:

What a difference a day makes, no?  One successful thrust and we are up and out of the consolidation zone once again, and ready to make a run at the early January highs ($16.50 area).   We may get a couple of pullbacks from here, but I think we will proceed to that stated goal relatively quickly before pausing to coil again.

Our friend Baby [[HUI]] is also showing signs of robust life, not two weeks after becoming as oversold as that index had been back in the dark days of November ’08.  

Note how the MACD and the slow stochastic are only just turning up on this weekly chart?  It makes one want to touch one’s staggeringly huge bouffant, doesn’t it?

There’s a lot of run left in this move, I think.   Maybe we’ll even shoot past the recent highs of $520 in this cycle.   With the dollar continuing to flag, and the price of gold holding about $1,120 — I have all the confidence in the world.

Back in the here and now, I continue to like all the precious plays I named in yesterday’s post, and I also like the “N” team, NovaGold Resources Inc. (USA) [[NG]] , New Gold Inc. (USA) [[NGD]] and Northgate Minerals Corporation (USA) [[NXG]] .   My top picks continue to be in silver, and especially Silver Wheaton Corp. (USA) [[SLW]] and [[EXK]] .

I also like the action in my two tech favourites (sic) today, Cree, Inc. [[CREE]] and Veeco Instruments Inc. [[VECO]] .   I actually attended a venture capital presentation this afternoon on nanotechnology that blew my socks off.   This new company’s first major customer was Veeco.   I think that may be a sign, I dunno.

On the “other metals” area — the three T’s will be strong with steel ripping.   Don’t forget Thompson Creek Metals Company, Inc. [[TC]] , Teck Cominco Limited (USA) [[TCK]] , and Titanium Metals Corporation [[TIE]] , as well as RTI International Metals, Inc. [[RTI]] , which has moved nicely in the last year or so. 

Finally, I would be remiss if I left off my two platinum blondes [[PAL]] and [[PTM]] .   Buy these and get a year’s subscription to Lady GaGa Magazine.   It won’t disappoint.

Your faithful servant in the Reign of the Sun King,

Jake.

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Omm Nom! Nom! Nom!
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Looks like Mr. Limm and kin are trying to take away our punch bowl.   Not bloody likely, I say.

You see, the Chinese really only have one way to cauterize the inflation wound they are already seeing in their economy — and that’s by removing themselves from their peg to the U.S. dollar.  They can make all the noise in the world about raising reserve requirements and dampening loan growth, but they will will still strain to be heard over the “clack-clack-clack” of the U.S. Mintex 3ooo Printing Robots in the basement of Ben Bernanke’s Transylvania Castle.

I say, if the Chinese refuse to de-peg their currancy and let the Yuan run free, naked and untethered, they ought to just continue to get drunk and buy stocks.    It’s the only rational thing to do when you are allowing your currency to be devalued right along with that of the Great White Ghost across the Pacific.  

And let’s face it, there’s only so much iron ore, coal, copper, lead, zinc, chromium and every other heavy metal for industrial usage left in this globe.   Outside dredging the Hudson River, that is, but even that reclamation project is years away.   The Chinese know all this and realize the only way to keep those prices cheap to them is by miming along to the dollar prop story.  

Again, raising Chinese reserve ratios is not going to do that if Helicopter Ben is easing quantitatively as fast as his machines can print, purchase and store massive haystacks of U.S. cabbage like he is.   We all know (and yes, the Chinese leadership knows) that fast cash to you is just heading right back into the Chinese economy via click-bought and big box consumer goods purchases (oh, and look here, retail sales are strengthening… wonder where those goods are coming from?).  What’s more, that money, once washed up on the shores of the South China Sea has to go right back into the commodity markets as the Chinese continue to build out infrastructure and purchase raw materials inventory.

Here me now and believe me later — The Chinese cannot “whip inflation” by themselves while they are tied to the dollar, and while their growing economy is tied to our consumption.   These are infrastructural realities that are not going to change because the Chinese CB has decided to take a stern line on lending reserves.  So sorry.

My take?  Eat a samich (sic) this morning until at least 11 am to see where the market settles out.    Gold is currently down only about $16 (less than 1.5%) and silver, as usual is taking it harder, down 44 cents (2.8%), with the DXY at a current $80.64.   I continue to believe this is a shakeout, and that the dollar will not continue much higher than here, despite all this “nooze” circulating to keep it propped.  If we break much above $81, however, I will be forced to reassess, and perhaps take a little off some of my riskier metal plays.

Best to you all.

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Update:  I notice in my haste to get out this morning’s post that I neglected to give you a run down on yesterday’s purchases (which were recorded in real time on The PPT, of course, as were today’s).   Yesterday I added to the following positions:

2k Petroleo Brasileiro SA (ADR) [[PBR]] @ $40.60

4k Exeter Resource Corp. [[XRA]] @ $8.46

2k Eldorado Gold Corporation (USA) [[EGO]] @ $12.66

2k Thompson Creek Metals Company, Inc. [[TC]] @ $12.67

10k NGAS Resources, Inc. [[NGAS]] @ $1.62

1K Sociedad Quimica y Minera (ADR) [[SQM]] at $37.06

This morning’s purchases (also “adds”):

2k [[PAAS]] @ $21.75

4k Gold Fields Limited (ADR) [[GFI]] @ $11.75

 

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 [youtube:http://www.youtube.com/watch?v=-ERnT1X9HPw 450 300]

A Song for the Times?
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Well, so much for Helicopter Ben’s New York Times- abetted “tightening” kabuki theater act.

Did you enjoy it?  I hear he’s been studying at the New School.

I dunno, maybe the guys down at Goldman called Bernanke up last night and asked him for some help in getting out of their Euro shorts, since DXY (sorry, no quote yet — see? [[DXY]] ) had run up to about $80.30 today by lunch time, only to tuck tail and (Black?) swan dive right back down to $80 flat just in time for Benjamin’s Jawboning routine at 2:15 pm. 

That particular bit of mummery and prestidigitation must’ve in turn convinced at least one or two bag-holding kaftan merchants from Milwaukee to buy dollars again, because the dollar index got all the way to $80.10 by late afternoon, giving us all that familiar “blah” feeling at the close.

All pretense seems to have dropped away after the stock mavens went home, however, and the dollar is now (as of 12:36 am Eastern) trading back down to yesterday’s low’s at about $79.74, looking at a “next stop” of about $79.50, and then $79 even.     Party on, Garth (and Darth… Vadon, that is).

These incipient moves should be enough to get our rally on in the gold and silver sector, not to mention our other hard currency equivalents including earl, natural gas, and the specialty metals.   I was extremely busy today and I apologize, but my punishment was not being able to add much to the portfolio, although I would’ve loved to finish my Allied Nevada Gold Corp. [[ANV]] accumulation today.   I am quite sure it will be more dear tomorrow.  

I was able to add 60 more June $40 [[GDX]] calls at $5.80.   They were a standing order, and I think I may have been able to get them even cheaper, but beggars, chooser, etc. etc.   I now have total 120 of those $40 June strike calls, and I think I’m done there.  

 The rest of my exposure will remain in liquid equities, and I hope to add to positions tomorrow in the usual suspects, and perhaps some NovaGold Resources Inc. (USA) [[NG]] , New Gold Inc. (USA) [[NGD]] and Northgate Minerals Corporation (USA) [[NXG]] .   I also like Exeter Resource Corp. [[XRA]] ‘s relative strength as of late.  

For silver I may dip my toe in the Chanci selection — [[SVM]] , as I’ve admired their price action recently.  I may also look to grab some additional [[PAAS]] .   If [[CDE]] stalls in the early trade, I may also add to that one.

Platinum is reviving tonight along with its brethren, so don’t forget about [[PTM]] and [[PAL]] . 

On the non-precious side, I may grab some [[ERX]] for a ride similar to that of [[AGQ]] .   I also continue to like Petroleo Brasileiro SA (ADR) [[PBR]] and Occidental Petroleum Corporation [[OXY]] .    I also happen to think SandRidge Energy Inc. [[SD]] is undervalued here, and it is a perennial favourite (sic) of The PPT .

Last, don’t forget Thompson Creek Metals Company, Inc. [[TC]] , Teck Cominco Limited (USA) [[TCK]] and Titanium Metals Corporation [[TIE]] in the specialty metal names, and Sociedad Quimica y Minera (ADR) [[SQM]] , as their lithium is a bargain here as well.    I expect tomorrow will be a good day for we merry shipmates of the U.S.S Jackson.

All aboard!

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Truck O’ Molten Assets
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That beeping sound you hear is me backing up the truck, and grabbing some more lovely PM positions as the sun goes down on this day of dollar death.

I’ve mentioned that I love Allied Nevada Gold Corp. [[ANV]] for the long term, almost as much as I like Silver Wheaton Corp. (USA) [[SLW]] on the silver side. IAMGOLD Corporation (USA) [[IAG]] and Eldorado Gold Corporation (USA) [[EGO]] cannot be ignored here either.   They are running on Greek kisses and Spanish wishes, but so what?   With the dollar (DXY) and it’s proxy, [[UUP]]   down 53 cents and 17 cents, respectively, as we speak, I think we may have that turn in the dollar we were looking for at last.  If we continue to stay below that magical $80.20 line, I’ll be even more sure of it.

Let’s face it folks, it would be great if the European Central Bank could maintain this Teutonic “austerity” charade with regard to it’s wayward little brothers to the South,  but the fact is, if they want to keep their phony baloney Starfleet Federation currency trading with any credibility, they will have to continue to subsidize the mistakes of the least common denominators.    And yes, this seems anti-intuitive, to save the Euro by weakening it with these bailouts, but the fact is the world markets prefer stability to necessary nut cutting.

Truth is, the Germans will some day emit a huge sigh of relief when they get their beloved Deutschmark back and they can once again run rampant over the rest of the Europe in currency blitzkrieg, if not via their formerly preferred method of  “Large Iron Rolling.”    Until then, they will stubbornly continue to try to make this European Union thing work,  and cope with continuing annoyance at those who would rather hang out in the sun, drink Ouzo  and go sailing, whilst dancing the mazurka and opening large menu diners.

All this brings me back to the punch bowl party over on this side of the pond.  With the Euro saved,  for this week at least, the robots at Goldman Sachs have been re-programmed to short the dollar and buy Barbie dolls and other such Mattel, Inc. [[MAT]] toys — Hasbro, Inc. [[HAS]] anyone?

We, the proleteriat, can now come back down off our panic chairs and continue with our most profitable line of employment — namely, fondling gold bars until their corners go smooth and sucking on silver ingot lozenges until our colds go away.

I continue to love, and accumulate the above mentioned names, and in addition I am grabbing, as I type (with my other hand) some [[EXK]] , Royal Gold, Inc. [[RGLD]] , Exeter Resource Corp. [[XRA]] and the “N’s” — NovaGold Resources Inc. (USA) [[NG]] , New Gold Inc. (USA) [[NGD]] and Northgate Minerals Corporation (USA) [[NXG]] .   

Last but not least, I like lithium (you know why, don’t you?) in Sociedad Quimica y Minera (ADR) [[SQM]]  , and I like to say “molybdenum” ten times frontways and then ten times backways.   If Thompson Creek Metals Company, Inc. [[TC]] is not bought out by the likes of BHP Billiton Limited (ADR) [[BHP]] or Freeport-McMoRan Copper & Gold Inc. Freeport-McMoRan Copper & Gold Inc. Freeport-McMoRan Copper & Gold Inc. [[FCX]] or even Teck Cominco Limited (USA) [[TCK]] (its fellow Jackson) within two years, then I’ll be greatly surprised unto paralysis.

Peace be upon you, my brethren, as our plan “comes together, right now, over me.”

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It’s quite likely I’ll start to unwind my hedges tomorrow… especially those covering my PM and commodity positions.

It’s hard to discard the evidence that’s popping up all around me.   Yes, we’re overbought like a mother, and yes, we’ve not had a cycle turn in 44 days.   However, I’m seeing precipitous increases in my hard asset positions that point to increased currency devaluation insurance being purchased across the board.    The dollar has not yet broken down, but the metals are being bought in big, breakout ways, visible even in my longer term weekly charts.  

Here are three alone that start with “T,”  — and what’s more, none are even precious metal plays.   My Silver Wheaton Corp. (USA) [[SLW]] ‘s and IAMGOLD Corporation (USA) [[IAG]] ‘s are a story unto themselves.    I will likely start rolling back into those tomorrow as well, but for now, let’s look at these steel-related commodities…

First up is the old weasel Titanium Metals Corporation [[TIE]] , which I’ve bot many times in the past, only to be disappointed.   It’s been earning merit badges these last three weeks, however, and looking like it wants to get back in the Troop:

As you can see, this should go to $17.50 relatively quickly (dare I say after a pullback to that consolidation breakout?), and the next major resistance is very close to $30.  

Now consider our Jacksonian non-PM friends.  First, the frisky Thompson Creek Metals Company, Inc. [[TC]] :

The volume from this week just cannot be ignored (especially given it’s only Wednesday!), and this Jackson looks like it’s only now getting it’s legs for a larger launch, likely inflation fueled.  $16 is an easy target, but long term, she goes to $24, I think.

Last, let’s look at fellow Jacksonian Teck Cominco Limited (USA) [[TCK]] , which seems to be finally breaking out of a minor consolidation after a very quick spurt from the depths of despair back in March ’09.   This stock has come a long way from well below $5, but I think it’s got some to go as well:

As I mentioned, the price of gold and silver and the actions of [[GDX]] and Baby $HUI today also give some assurances with regard to my silver and gold positions.   While I will hope for some more pullback here, I will not expect it, and I will likely start pacing back up to “full position” in those names again as we go forward this month.

Best to you all.

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`Twas brillig, and the slithy toves
Did gyre and gimble in the wabe:
All mimsy were the borogoves,
And the mome raths outgrabe.

“Beware the Jabberwock, my son!
The jaws that bite, the claws that catch!
Beware the Jubjub bird, and shun
The frumious Bandersnatch!”

He took his vorpal sword in hand:
Long time the manxome foe he sought —
So rested he by the Tumtum tree,
And stood awhile in thought.

And, as in uffish thought he stood,
The Jabberwock, with eyes of flame,
Came whiffling through the tulgey wood,
And burbled as it came!

One, two! One, two! And through and through
The vorpal blade went snicker-snack!
He left it dead, and with its head
He went galumphing back.

“And, has thou slain the Jabberwock?
Come to my arms, my beamish boy!
O frabjous day! Callooh! Callay!’
He chortled in his joy.

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(Note: Above is actual eye witness report of my Fed Dollar battle today)

Not much to report tonight.  A little bit of pullback at midday, but I did indulge in some egregious silver miner [[CDE]] call options (as reported in the earlier thread, I took down 40 Oct. 17.50’s at $2.60) for a lark.  I really do think CDE will be a nice hold here for a bit.

IAMGOLD Corporation (USA) [[IAG]] had some run up today (to $14.87!) but then sold off to end the day at $13.40. This stock doesn’t seem to know what to do (it was up again 25 cents in AH), but I would guess it’s going to consolidate along with a bunch of other fast runners here, including even our $HUI index. I still like silver here, as I may have mentioned.

On the non-precious side The Andersons, Inc. [[ANDE]] has broken out over $33 and my next target is $39. Despite all the other rockets popping, this is still my best performing Jackson at +99.6% since our May 1st inception.

Other non PM Jacksons that look strong here are again Thompson Creek Metals Company, Inc. [[TC]] and Teck Cominco Limited (USA) [[TCK]] . Monsanto Company [[MON]] bides its time, but reserves the Hippocratic Oath for now. Other non-PM “hoppers” I like include RTI International Metals, Inc. [[RTI]] , Calgon Carbon Corporation [[CCC]] , Titanium Metals Corporation [[TIE]] and yes, even Alcoa Inc. [[AA]] .

The Jacksonian Portfolio stands at a “mahvelous” 31.4% return for the little more than four months its been in place. I thank you for your patronage.

See y’awl tomorrow.

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