3 Charts

by JDH on March 16, 2019

Let’s start with Tesla, shall we?

Tesla has strong support just above $240, and strong resistance at just under $390.  So, the question is, which resistance level gets tested first?  I’m betting it’s the lower one, and I will not be at all shocked if $240 is broken soon.

If Tesla made gas cars I would say they are leaking oil, but I guess that analogy does not work here.

Neither do their cars.

They made a show of introducing the Model X, which is essentially a PT Cruiser.  The market laughed, and Tesla dropped 5%, the first time a new product announcement was treated with derision.  They have no cash, and they have no factory in which to make this car, and they have closed many of their stores and laid off a big chunk of their workforce.

I’m holding puts, and will continue to do so.

Of more interest to me is TGOD.C – The Green Organic Dutchman, my favorite cannabis stock.

I bought it as a private placement prior to the IPO last year, so I am sitting on a profit.  The stock got way ahead of itself, hitting $10, before crashing to $2.  (My shares were restricted, so I couldn’t sell at the peak).

No worries, it has more than doubled since the start of the year.  It would appear that we are in a consolidation phase now, but I expect that by the end of the spring it will break through $5, and when that happens $10 is the next target.

I’m holding.

Finally, our thoughts turn to gold.

I present for your edification a ten year chart.

We had a great run in 2010 and 2011, followed by a five year bear market.

That happens.

Since the low around $1,050 at the end of 2015 gold has been in a jerky consolidation phase, with $1,400 the next important target.  I assume it will get there this year, but who knows, the consolidation could continue for a while.  We shall see.

I’m holding, having added to my positions during periods of weakness.

My favorite gold holding is EQX.V – Equinox Gold Corp.  It had a long correction period, but that’s over, so I expect to see $2 later this year.

We shall see.

Thanks for reading; more next week.



Update on Tesla and Pot Stocks

by JDH on March 9, 2019

Today we discuss pot stocks, and a stock that is going to pot: Tesla.

The chart seems clear to me.  From a high of $370 in December, Tesla touched $270 this week.  It does not take a charting expert to realize that a series of lower highs and lower lows is a down trend,

Technically the stock looks horrible, but fundamentally the story is even worse.

Tesla can’t build cars.  The quality is horrible, and now they have announced that they are closing most of their stores, so if you want to buy a car you will have to buy it online.  No test drive. Just buy it (but you have 10 days to return it if you don’t like it, so you are paying full price for a ten day test drive).  The on-line model works fine for their fan-boys, who think Elon is doing God’s work, but they’ve all bought one of these lemons.  All future growth has to come from the general public, and there is no way the average consumer will buy an over-priced lemon without even taking it for a test drive.

This stock is done.  Here’s how I’m playing it:

I buy out of the money puts, and when they go up, I sell them, and buy a slightly cheaper put.  For example:.

On March 1 I bought the April $270 puts for $11.80, and later that same day I sold them for $12.95.  I then bought the April $260 puts for $10.40, and on March 4 I sold them for $12.80.

On March 5 I bought the May $200 puts for $9.75.  Oops, the stock went up, so I bought more for $7.87 to average down my cost.

I am currently holding those puts that expire on May 17, 2019 with a $200 strike price.  Why $200?  No reason, other than I have a set budget, and I’ll start by buying 25% of my full allocation, and if they go up in a day or two, as happened at the beginning of the month, I sell them, and roll the money over.  If they go down, I buy another 25% allocation.

I’m currently 50% allocated, so if Tesla goes up at the beginning of the week, I’ll buy more, and keep averaging down.  As you can see from the chart, we are in a downtrend, so inevitably it will go lower.

I hope.

Pot Stocks

My favorite cannabis stock is TGOD.TO – The Green Organic Dutchman.  I started buying in private placements before it went public, and watched it go all the way to $10 in September, but since I was subject to a hold period I couldn’t sell my restricted shares (I did sell some of my unrestricted shares).  It then promptly crashed to $2.

However, since the start of the year it has more than doubled in value, and now sits at $4.26.  I apologize for the crude drawing, but it looks like either a bottom formation or a cup with a handle pattern, which portends a much higher price.

At the moment I’m holding.

The prudent play would be to start selling as it goes higher, something like sell 20% of my shares at $5, 20% at $6, etc, but since I have nothing better to put my money in at the moment, I’m holding.

Gold is also looking good, after a short rough patch; I really like EQV.V – Equinox; more on that next week.

Tesla on the brink?

March 2, 2019

For those of us who held Tesla puts, Friday was a good day. After hitting $321 at the beginning of February, it touched $288 on February 26, bounced back to $320 on February 28, and then closed back in on $292 on March 1. Why? Fraud Boy Elon said that they would start selling a […]

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Yes, I’m Still Here

February 23, 2019

For the first time in a decade I missed posting last week.  I was very busy, and totally forgot.  Also, I had nothing to say. This week, I have three things to say: First, it is obvious that the DOW is at a critical resistance level. The pre-Christmas crash has been completely reversed, and over […]

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February 9, 2019

Not much happened this week.  January was a great month, February has started with nothing remarkable to report. A quiet period can be followed by a bang, or a whimper. My guess is that we are catching our breath before another run higher.  Seems crazy given our level of debt, but that’s how this feels […]

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The Verdict on January: Great!

February 2, 2019

No complaints from this end; the weather was frigid at the end of the month, but portfolio performance was fantastic. Pot stocks: up Gold stocks: up Sweet. Does January action imply that 2019 will be a great year?  No.  All we know is that January was good.  Gold is far below it’s highs from a […]

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Great week for pot stocks

January 26, 2019

On Monday January 21, my favorite pot stock, TGOD.TO – The Green Organic Dutchman, traded as low as $2.80.  On Friday it traded as high as $3.85.  That’s a swing of over 35% in a week.  Not bad. They have announced a new joint venture. (Not that kind of joint; I’m not making puns here; […]

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Tesla – The Bloom is Off the Rose

January 19, 2019

Alternate Title: Tesla – Has this ponzi scheme finally been exposed for what it is? I am not a fan of Tesla. Yes, I’ve had a drive in the car, and the car is cool.  It looks fine.  It’s quiet. It’s quiet because it’s electric, but so is a golf cart, and that’s the problem.  […]

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Gold, Pot Stocks Looking Good So Far in 2019

January 12, 2019

Yes, I realize it’s early here in 2019, but my two biggest sector holdings, gold and pot, are doing great. (Yeah, I know, that’s a low bar, because gold has been in the doldrums for four years, and cannabis stocks got hammered in the fourth quarter, but still). My favorite pot stock, The Green Organic […]

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Good First Week, and Thoughts on Trump

January 5, 2019

It was a short week to start 2019, but it was a good one, primarily because gold appears to be awakening from it’s four year long slumber. My working hypothesis is that we will see $1,300 in January, and $1,350 in February.  After that, who knows.  There is uncertainty in the world now: what will […]

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