A Week of Nothing

by JDH on December 7, 2019

Nothing happened this week, so I won’t waste your time saying anything.

I have sold all of my losers for the year, I have a big cash position, and I’m ready to take advantage of bargains during tax loss season, should any present themselves.

That’s the plan, more next week, if anything happens.

Gold: More of the Same?

by JDH on November 30, 2019

Two weeks ago a wrote Gold: A Deeper Dive, where I made the point that gold is still in a long term bull market, but the near term future is more uncertain.

Price action over the last six months illustrates that point.

Gold spent a few months building a base in the $1,300 range, then shot up to $1,550, before setting what may be a new base in the $1,450 range.  ($1,445 is a more precise number).  That’s the approximate midpoint between the 50 and 200 day moving averages, and it’s the approximate midpoint between the uptrend started in May and the downtrend started in September.

The pennant formation can’t go on forever, so gold will have to resolve to either the upside or the downside.

(How’s that for insightful analysis.  Hey, you get what you pay for).

Which way will it go?

The Relative Strength Index is at 48, and turning upward, so that is traditionally a good buy point.

Historically, gold stocks tend to be flat in December (rising about as often as the fall), but over the last few decades the first quarter is the best performing quarter for gold, so purchases on weakness in December may be rewarded with higher prices in the new year.

Last year gold finished the year around $1,274, and then bounced to $1,350 by mid-February, a 6% pop, before retreating back to $1,270 in May.

NUGT – Direxion Daily Gold Miners Bull 3x Shares NYSE + BATS, an ETF that holds gold mining shares, and uses leverage to attempt to get 3 times the move in the underlying stocks (both up and down, so it’s a risky play), had similar price action, only more pronounced.

NUGT ended 2018 around $16, and bounced to $24 in February, a 50% gain, before giving it all back, and more, to around $14 by May.

From there NUGT jumped to $45 by the start of September, a nice triple, before giving half of it back, to where we are today.

So what does that all mean?

Buy NUGT at $25 in December, and sell it at $40 in February, I assume.

Nice work if you can get it.

I’ll keep watching.  More next week.

Tesla: How is this still a thing?

November 23, 2019

So Elon has this new square ugly cyberbruck, that has bullet proof glass.  So to demonstrate, they drop a metal ball on a regular piece of glass and it breaks; they drop it on Tesla glass and it doesn’t break.  Cool. Then Elon says “hey, throw it at the car window”.  It shatters. The Elon […]

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Gold: A Deeper Dive

November 16, 2019

Let’s start our discussion of gold with some long term perspective: This is the 20 year chart of gold, and as is plainly obvious, gold began a long, slow, bull market back around the time the dotcom bubble burst, with gold in the $250 range.  There was a pull back in 2008 when the credit […]

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Pot Stocks Bounce Back

November 9, 2019

Not much of a story today: cannabis stocks bounce back. Canopy Growth, one of the biggest names, was up almost 13% on Friday.  So should we all buy pot stocks? Nope. Friday’s action was meaningless, nothing more than a blip in a massive downdraft. Canopy Growth was almost $60 at the start of summer, and […]

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Nothing to Add

November 2, 2019

I have nothing to say today, so I will say nothing, other than stay the course. Tesla has peaked and will fade, and gold is looking good, but I don’t see anything big happening in the next week, so whatever I’ve said in the past, keep doing that. How’s that for short and sweet? Perhaps […]

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Tesla – The Sequel

October 26, 2019

Well, that was quite the bump for Tesla. From around $170 back in June, Tesla touched $330 on Friday, very close to a high for the year.  Amazing. As long time readers will know, I am NOT a Tesla believer.  I think Elon is a great salesman, and has managed to convince numerous governments around […]

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What’s Next?

October 19, 2019

What is next?  We have a federal election in Canada this week, but I don’t expect that will have any impact on the markets, unless perhaps the NDP gets a majority government which would tank the Canadian dollar, but I don’t see that happening. In the U.S., Trump is Trump, but he is also a […]

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Have the pot stocks fallen so much that they are now a buy?

October 12, 2019

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 […]

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Bad week for the market, good for gold

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 […]

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