Mmmmmmmmmm….. Deeee-licious!

Looks like our friend “Baby $HUI” — the Amex Gold Bugs Index is just about to pull back to our second line of resistance that I’d plotted out some week and a half back.   If you recall, the chart looked like this:

In the above, we’d hit that magic $400 barrier and come back already to our first point of resistance.  Well, as of late last week, we’ve come very close to that second line and will likely hit it sometime today (Update: We’ve hit it and then some at $341– next stop could be our 13 week MA at $337.30).   Therefore, I think we need to keep our eyes open for a bounce here at least back to that first resistance level at $375.    Here’s where we are today:

Because of the relative strength of this sector, I think it will continue to lead, and show it’s bull head before the rest of the market does (if in fact the rest of the market continues with its bullish ways).   Short synopsis, this is your only confirmed bull in the market right now, with most names riding above their 200-day MA’s.   Therefore, this is where you want to play for fun and profit, no matter with what specie you purchase your ice cream cones.

There are a couple of POS miners that have yet to truly participate in this rally, and that may be because they are POS, so take this next chart with a kiloton of salt.   It’s the old dog, [[CDE]], which has dropped back down to attractive levels again, and is down over 5% as I type this.  Keep a tight stop here, but I continue to think this old hag still has a chance to come close to her 200 day MA at close to $30 here.  Here’s her weekly:

One last note — be cautioned as [[UUP]] is back above it’s 61.8% fibonacci line of $24.06 as of about 9:40 am this morning, which could spell at least temporary trouble for the markets in general.   In the case of this PM bull, I believe it smells of  opportunity.  Best to you all.

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Update:  Barron’s weekend pick  and Jakepick (non-Jacksonian) [[NG]] showing her mettle, up almost 8% in a down market.  I own shares, but will likely add to weaker names.  [[RBY]] in particular looks good here.  Word on the PPT is that it’s a possible [[GG]] takeover.

Update: @ 1:57 pm, $HUI is right on the trendline right now at 334, give or take.   If UUP folds over, this could be an excellent purchasing opportunity.  Keep a gimlet eye!

Update:  Bot 1k more [[AGQ]] @ $44.01.

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UUP is our proxy for the dollar as you recall.   It’s right at make or break here hanging about it’s 61.8% retrace.  Now, on my other graphing software, the 61.8% — Golden Ratio — retrace line is at $24.07.   No matter, we want this sucker below $24 to feel good about the dollar not threatening this rally again.  

Good thing we are in PM’s and heavy metals as they are negotiating this squall just fine today.   On the gold side, [[ANV]] continues to show real nice relative strength, to the point where its making me wonder if there’s not something going on.   [[PAAS]] and [[PTM]] are doing well as well, and you may want to have a sally at [[NG]] as it’s getting bootstomped for no particular reason while [[NXG]] is up.  Perhaps it’s the “X” chromasone?

I like [[TIE]]  and [[TC]] is just insane.  I may sell the calls after this posting, in fact.   In the meantime, the golds and silvers are hanging tough, and [[TBT]] is right at my intermediate sell level (high of about 59.50 today).   I may sell the calls on that one as well, depending on what the dollar does to the close.

On other crazy stuff, [[ENTR]] is finally breaking out, while the [[HEB]] takes it in the shorts.   Watch that one, along with [[IMGN]] as I think they’ll both “be baaahhk” like Arnold.   Another Fly buy is [[OVTI]] which I’ve had for a while now, and is finally perking.

Queries welcome.

Here’s a great theme for today.   Whether we’re talking the dollar or the market, you gotta love this humble boy from Northern Florida.  Fantastic rendition, too, the way he gets the blase LA crowd to sing the whole first verse (Hat tip to Boomer):

Update:  Funkier version from Hamburg, sorry about the “non-embed” you can see that one on Youtube.

[youtube:http://www.youtube.com/watch?v=RiztRc910Ps 450 300]

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 Update:  Sorry, no calls to sell on TC!  Therefore I am selling one third of my position here at $11.21.   I am risking that I won’t get the better price to reload.

Update: Bot 1k more [[GDX]] @ $40.88 for shizzles and gizzles.  Hanging on the 61.8% fib.

Update:  Re: [[UUP]]– she ended up at $24.00 on the dot.  Isn’t that just like a woman?

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There is nothing like “living for the moment,” and I won’t begrudge the staunchest of my conservative reader base a splash in Fly’s Pool of Carney Delights,  over on his blog and in the incredibly exciting “User Notes” section of The PPT  .   Let me assure you, ladies and gentlemen, there be some astute trading minds throwing Kruggerands around in that room.

That said, I’m sure glad I’ve got the bulk of my holdings in the JCHP, my friends, because I’m not sure how much time is going to be left in this “bring your own lava lamp” filthy 70’s-era hot tub party.    I think I already see some unpleasant objects of questionable birth rising up amongst the bubbles.  

First, I’ll draw your attention to our friend, Mr. U.S. Dollar.   He’s pretty much in “do or die” territory here, and frankly, I’m thinking we’re in trouble whether he strengthens or not.    Lookee here — remember our faithful dollar proxy UUP?

Well, heck if he’s not banging around down at the same December 18th lows that set the timer going on our next market plunge (which occurred about two weeks after the dollar started to climb again).   And here’s what’s worse… the dollar can continue to go down here, but I’m not sure that’s going to benefit our stock markets much, either.  

Why?   Well because there’s another bit of business the dollar keeps low if it’s behaving, and that’s our Treasuries’ interest rates.   If we show relative strength in our dollar, then foreign investors are willing to keep our debt.   But if the dollar keeps getting mauled here… well, those same folks might not be so kind to our lovely treasury paper.   Remember back when we first advocated  TBT as a Jacksonian pick?  Here was the chart:

We were expecting a nice move up, and we sure got it — in spades.   However, now the rapid run up in rate must give us pause with regard to how much longer the music can play.   Look at how far we’ve come since that last posting:

Bang!  All the way above the 200-day EMA.   Now you know I’ve been selling calls against my position here, in anticipation of a pullback.  Well, even as I expect a pullback, I’m just as ready to take a loss on those calls if I see this thing launch anymore than it has.  

Remember, TBT is my “Stock of the Year” pick in Rajun’s annual contest, and I continue to believe TBT is going to be the play of the next three to five years, minimum, thanks to the unwinding that will have to happen in our long term bond rates.   That said, high interest rates eventually take a bite out of stock prices, so we are going to have to be even more synched than ever with the JCHP. 

Remain vigilant my friends, and make sure you attend to RGLD.   I believe it’s the harbinger of our gold holdings’ future.   The other PMs will follow it’s lead, but it will likely become the star of this Jacksonian portfolio in future.

UPDATE:  I added another 1,000 shares to my SSRI holdings today.   I will add another 1,000 if I see further weakness, and then I will likely be “full up” in this name.

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		26-May	% Change
ANDE		$   24.95	6.90%
GDX		41.84	-0.50%
GLD		93.76	-0.73%
IAG		10.56	-2.76%
MON		85.25	-1.57%
NRP		22.75	2.43%
PAAS		21.64	1.03%
RGLD		45.38	2.53%
SLV		14.42	-0.55%
SLW		9.49	1.61%
SSRI		20.82	-4.19%
TBT		55.07	2.80%
TC		8.73	1.04%
TSO		16.73	3.08%
Avg %			0.85%

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