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I don’t have a lot of time, as I’m “leaving on a jet plane” from Minnesota South, also known as Palm Beach County, Florida, to warmer climes in the Bluegrass region.   Also dealing with some family issues, not the least being my wife’s tolerance for “vacation” with our four kids — “not to exceed five days/nights” it read on the labelling.  Can you picture the look she’s giving me as I tap these words out whilst I should be loading the car with luggage?

Yet, it’s my devotion to my Docteur Le Fly, his magical engine in The PPT,  and my good bloggish friends that drives me like a grizzled veteran of the India campaign is driven to a brown ale at the end of a long day of patrol. 

Here’s what I’m seeing, and be sure to filter it through all my inveterate bias and natural cognitive dissonances.  I think the dollar is gasping it’s last for this time period.   It’s raging against the dying of the light in the most poetic way, but it’s punches north grow weaker and weaker, even despite all this news of imminent employment doom and Grecian tragedy.  [[UUP]] would need to stay north of $23.60 to remain convincing that the dollar possibility is still on, and DXY above $80.50.  

I think a weak employment number only weakens the dollar tomorrow, while a strong number (unlikely, as we’ve seen bruted) marches the market north.  Either way, I see “up” for our friends on the PM side.   Note how the [[HUI]] has broken out of it’s downtrend and is now looking to successfully touch both the downtrend and the 50-day EMA at $415?

I think this will be our signal to buy with both hands.

Here’s the stock I like most for those who are interested.  It’s gold, and it’s been golden to me and mine.  I don’t see why that shouldn’t continue.

Best to you all, and I’ll speak again with you after touch-down back north.

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While nothing is yet set in stone, two big precious metal “tells” are indicating that, POG and POS, aside, we may have braved the gauntlet of the recent harsh pullback in the sector, and could be looking at a resumption of the secular bull.

I know this is slightly contorversial, as I am gainsaying a friend and mentor, Mr. Gary Savage of the SmartMoneyTrader, whom I respect and esteem at levels equal only to our own beloved Monseiur Le Docteur Le Fly and the crew down at The PPT.  Gary believes we are going to test at least the $1044 level on the POG, and quite possibly have nother retest of the $350-375 levels on the $HUI.

While I often find myself in agreement with his fine logic, I am not so sure he has his cycles right this time.  My current charts look to be showing something more promising:

 {Jake Closes Deal in Interrum — “And There Was Much Rejoicing!}

You probably also remember this [[GDX]] chart from the last time I posted it.  Well, we’ve tested the 61.8% retrace again this week, and held serve.  About 15 more cents, and we’ll be back above the 34-week moving average.    Whatever the case, I think this bodes well for the larger miners going forward:

Last but not least, our old friend the dollar.  The weekly view, seen from our proxy [[UUP]] seems to indicate a red doji on intermediate volume and (mostly) declining stochastics:

  Note also, price level has reached the top of the “consolidation zone.”   The week ahead will tell us if the dollar is just resting, or getting ready to lock back into it’s secular bear cave. 

Best to you all, my scurvy swabbies.

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                           Nom Nom Nom
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Here’s why I’m eating sammitches.  Watch that dollar, it’s still overbought… and I can’t tell if the Trannies, and especially United Parcel Service, Inc. [[UPS]] (their leader, as I’ve mentioned), is leading the SPX, or vice versa.

FWIW, it’s supposed to work — according to Dow Theory — with the Trannies leading.   Let’s see what we can see on a weekly basis.   First SPX, looking very indecisive:

Now, have a look at United Parcel Service, Inc. [[UPS]] , which has shown great relative strength these last few weeks…

And last, most curious of all… the Dow Jones $TRAN Index  itself … curiously, already above its 200 week -EMA.   To stay?  I know not… hence, my sammitch eating:

I hope to have more tomorrow for you… including a closer look at the dollar, which remains ridiculously overbought.   I am staying with everything as of this evening, however, including [[TBT]] and all my $HUI friends.  

Best to you all.

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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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Dieu bénissent le Fly
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Let me just say that I’m grateful this day for my good friend, Monsieur Le Fly.  

Before tonight’s market discussion, however, let me tell you a brief story, not altogether “out of school.”    This summer, my wife and I dined with Monsieur et Madame Le Fly. 

By dint of fast L.I.R.R train out of Atlantic Beach, we arrived at le restaurant (downtown NYC) first, and were able to have a quick cocktail while we awaited our dinner companions.   Since the restaurant was bayed and glass fronted, and our maitre d’ was kind enough to seat us in front of said bay glass front, I was able to steal a first glance at madame and monsieur even before he first laid eyes upon me.

Therefore I was immediately able to take the measure of his character, and let me tell you why.   No, it was not the solicitous manner in which he comported himself with madame (although that was certainly nice).   Nor was it his clean appearance, or even his upright posture, however positive those fixtures might be.

No, it goes back to something my father taught me as a wee lad, no more than 13 and approaching the narrowing straits of manhood. 

“Jake,” he said, putting his arm around my shoulder in an almost conspiratorial fashion,

 “Always be wary of a man who is better looking than his wife, as  it’s a sign of a weak character.”

Let it be said that it’s further credit to Madame Le Fly that Monsieur is by no means an ugly man.  It is merely that she is le soleil to his la lune — the gender nominatives notwithstanding.

Second hint — La Lune insisted on picking up the tab.   So it goes with my friend, Monsieur Le Fly.

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But let me not soften tonight’s “a la recherche de temps perdu,” etc., with too much overt sentimentality.   Tonight I laud my bon ami for keeping the rubes, stupes and tin pot bangers continuing to chew the gristle of regret and bitter grapes with regard to the most obvious bull market of the millenium.

Heck, maybe even the only bull market of the millenium.  

Please credit him with Svengali-like powers.   Only mon bon ami could so easily have the five figure account guys gamboling and capering with glee today about the ridiculousness of owning gold with these data readily available:

Know that he is doing the Lord’s work for you and your family by casting doubt on the gold-sound money thesis.   This spells “O-P-P-O-R-T-U-N-I-T-Y” for those of you who may have yet to participate.   Thank m’Lord le Fly and thank those who readily take his word with nary a thought toward logical analysis, or even limpid thought.

For they shall be the bearers of your wealth, well into the next decade.   God bless.

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There should be something of a bounce tomorrow, as we fast approach my mentioned $440 level on the $HUI.  We are also quite oversold on gold in the near term.    That said, I don’t think this pullback is over, and may only cover some shorted calls into tomorrow’s sell off.   Be nimble, be quick, etc.

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The Once and Future Gold Standard?
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Some quick notes on direction…

Despite the imprecations of some, this is wholly and incontrovertibly a dollar-dependent market.   Wither the dollar, there goeth the market.   Your bombastic arguments may be amusing, but the Santa Gods only chuckle when you laud “progress” and “economic viability” like some kind of Parallel Universe Bizarro Karl Denninger.

(Slap! Slap! Slap! Slappity-Slap!)  Get serious, at once!  

 This market is riding a giant tsunami of Bernanke dinero and that’s why it’s been going up like a drunk clown in a circus dirigible.   But it looks like Benny’s press machines are getting a rest, ovah heah.   Or maybe it’s just that the rest of the world’s craptastic fiat currencies need a chance to catch up.   In any case, the dollar is back above it’s 50-day EMA:

I think it’s very likely we could see the dollar rebound all the way to its 200-day moving average (between $79-$80) before it turns once again like a wounded albatross and heads for the longer term lows in the $71 range.

As for our friend Baby [[HUI]] , I mentioned the other day that on Wednesday last week it came within $3 of it’s old highs from March of 2008 ($519.68).   That $516.16 high marked the top, however, and we’ve quickly sold down since then to close today at $461.19 — a $55 dollar move in 5 days of trading.   

If the stock market is sensitive to the dollar, then the gold miner market is even more so.   That’s why I think that Baby $HUI has got some more work to do here.   Here are my targets: 

Do I think the 61.8% fib  (@ $378) is also in play?   You bet your sweet bippy, Grandmaw.  Verily, I think the move down here is going to be somewhat soul-crushing, and I think the miners may feel the worst of it.   I bot some more SPY puts ($110’s again) and now my stash stands at 250 contracts, with a number more of sold calls in United Parcel Service, Inc. [[UPS]] . Monsanto Company [[MON]] and Silver Wheaton Corp. (USA) [[SLW]] .

But the bull is not over, make no mistake.  So bide your time wisely, here, and keep your wallet hand loose and well manicured as you get ready for the next swing. 

That is all, save for my final admonition about the foolishness of your not yet becoming a member of the Trading Hive Mind in The PPT.   What gives?  Don’t you like money?

Spock out.

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