Fortunately for me, I began the liquidation process on my pot stocks many months ago, so I was spared most of the recent carnage.  The pot stock market is down around a third this year, and that’s a lot.

TGOD.TO – The Green Organic Dutchman has a brutal looking chart:

It closed on Friday at $1.19, and up 8 cents from it’s Thursday close of $1.11, the lowest it has ever been.  That ain’t pretty.  Their problem is that the financing that they thought they had in place to complete their growing facilities is no longer available, so their expansion plans are now on hold, and that’s a problem for investors.

That begs the question: if the stock was a buy at a market cap of a billion dollars, is it an even better buy at $300 million?

I don’t know.

My best guess is that they will have to do another equity raise, so presumably they will hope for a bounce in the price, and then try to raise enough equity to complete their projects.

I’m already out of the stock, and I have no plans to go back in, but if you are a gambler, perhaps now is the time.

Or not.

If they do need to do an equity raise, I would prefer to have cash on hand, so that when they do it I can get stock and a warrant, if that’s what’s offered.

So, for now, cash is king.

The smaller players will have trouble raising capital, so being an observer is the safest option.

Happy Canadian Thanksgiving; more next week.

Bad week for the market, good for gold

by JDH on October 5, 2019

I’ll keep this brief, since my thoughts haven’t changed since last week.

The market hit a rough spot this week, and so did gold, but gold finished strong, and I expect gold to have a strong week or two coming up.  Why?  It’s down, but it’s in an uptrend, so we should see strength in coming weeks.  Also, “golden week” in China is ending, and as I understand it, it’s like a vacation week where nothing happens, so no gold is purchased, which depresses the world wide place.  By the end of next week everyone is back to work, so I assume that will give gold a bump.

Or not.  What do I know?

I am also continuing to raise cash, because cash is king, and I would like to have a lot more cash in my pocket than I do now, so I continue to sell my non-gold holdings on strength.

That’s the plan; see you next week (if I have anything intelligent to add).

Not Quite Ready for Liftoff

September 28, 2019

Last week I said gold was ready for liftoff.  Oops.  Didn’t happen. However, like the stubborn mule that I am, I’m still not worried. As the chart shows, since the middle of July NUGT, my proxy for gold, has had a series of higher lows (the vertical lines) and higher highs (the blue circles).  That, […]

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Gold: Brief Pause Over, Ready for Liftoff

September 21, 2019

Pretty optimistic title, eh, from a guy who started buying gold heavily three weeks ago?  No worries, I am very optimistic for the next few weeks. Here’s the chart of NUGT – Direxion Daily Gold Miners Bull 3x Shares NYSE + BATS, an ETF with 3 times leverage to shares of gold miners: As you […]

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Two Weeks Too Early on Gold?

September 14, 2019

Two weeks ago I told you I was increasing my allocation to gold.  Last week, after gold had it’s biggest one day drop in three years, I told you I was a week too early. It would appear that I was at least two weeks too early, as the above chart of gold for the […]

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A Week Too Early

September 7, 2019

Last week’s post described how I was Increasing my Allocation to Gold.  On Thursday, gold was down $35, for it’s biggest one day drop in 3 years.  So either I’m wrong and gold is going lower, or I was early in increasing my gold allocation. I believe I was early, but not by much. Three […]

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Increasing Allocation to Gold

August 31, 2019

Now is the time to own gold. Gold last traded at $1,400 in early September, 2013. Here we are, exactly six years later, and gold has finally blasted through $1,400, closing on Friday at $1,529. That looks like a break out to me. Next stop: $1,800 There are, of course, three ways to play the […]

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On the Road

August 24, 2019

I am on the road this weekend, so I will simply say this: read what I said last week about gold.  Gold had a great Friday.  NUGT was up 12%, proving my point about volatility. The talking heads on TV will tell you it’s because of trade tensions with China, and that may be true. […]

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Gold: The Perfect Buy Point?

August 17, 2019

Here’s the chart of NUGT – Direxion Daily Gold Miners Index Bull 3x Shares Looks good to me. Since the bottom in May and June, NUGT has more than tripled, from $14 to over $40 before settling in at $35. The RSI is down to a favorable 52, the uptrend looks strong, so it would appear […]

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A Quick Speculation: Rubicon Organics

August 10, 2019

Last week I did a deep dive on gold, and nothing has changed on that topic, so I will give you another quick speculation: ROMJ.CA – Rubicon Organics Inc.  here’s the chart: But wait, you say, that’s a horrible looking chart! It peaked at $3.40 in mid-June, and then crashed to $2.60 on Friday. What […]

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