Saturday, August 20, 2011

Bear Creek Mining - buyout?

So I was thinking about Bear Creek. Since I take the 11:57 to Great Umbrage whenever I think of EPS-based price targets for miners, especially in a buyout situation, I decided to play with finding a ciggypack DCF NAV value.

So first, I removed the assumed $25M/yr interest (cos I subtract capex off the top afterwards - see below). Then I took that modified net income estimate and stuffed it through excel with a 23-yr mine life and 8% discount rate (you could even use 10% or 12%, since the natives are restless and El Presidente's a screaming Bolivarian communist).

Sum over 23 years, and then subtract $650M off the top for the capex.

This is what I get for DCF NAVs, and what it would mean per ounce silver in the ground:

$1.7 billion at $25 Ag, or $5.24/oz (no inferred),
$2.1 billion at $30 Ag, or $6.44/oz,
$2.5 billion at $35 Ag, or $7.63/oz, and
$2.9 billion at $40 Ag, or $8.83/oz.

What's the typical price for a silver buyout nowadays, per ounce in the ground? Obviously nobody pays $2B for Corani if that's their projected NAV. At the same time, if the cash costs post credits are near-zero cos of the lead and zinc, I could almost see an exec being able to justify paying $5/oz for a project. Not that I know anything about the mining world. But $5/oz seems something you could get people to agree with.

Anyway, if the buyout comes at 50% of NAV, that's $9.40, $11.55, $13.69 or $15.83 per share. Since the latter target is only for $40 Ag, I can see why Sprott would (or should) piddle his panties over BCM.

I'm actually going to be interested in reading the feasibility study, if it's still coming in 3q11.

UPDATE 1: whoops, just checked the MD&A and now they're saying it'll be 4Q11. Well, no wonder the buying pressure dried up.

UPDATE 2: whoops, the MD&A does the math for me, dumbass. Here's what it says on p.5:

If August 12, 2011 spot metal prices ($38.29 silver, $1.08 lead and $0.98 zinc) were used in the economic model contained in the PFS, without adjusting any of the other inputs, the after-tax net present value of the project would be $2.1 billion at a 5% discount rate. The project would also have an internal rate of return of 87%. Readers are cautioned that this information is supplementary only and although the PFS does contain some sensitivity analysis, this information should not be considered in isolation or as a substitute for the net present values and internal rates of return contained in the PFS, which were prepared in accordance with prescribed and standardized methods.

I haven't seen the old PFS, but from the numbers given on MD&A p.5 it looks like the Corani project's design front-loads high-grade ore. Which, I guess it should. That means my DCF NAV above is wrong (because I was assuming constant grade): but that's only because it's based on Otto's EPS calc, which is also wrong (because he was assuming constant grade and he's a newsletter writer so he should really know better).

Automatic Earth: DOOOOM... for gold?!?

If I comprehend Gary Tanashian's newsletter correctly, it seems to me that those of you who comprehend Gary Tanashian's newsletter correctly will know that he's got a grand narrative that serves as the fundamental basis for all his rather original macro charting.

I do follow GT's newsletter and consider it an important source of data for my own grand narrative... but I don't believe any one person can ever be right. So I synthesize. I find Ritholtz very important in this, and have now pretty much gotten into Automatic Earth's grand narrative as well.

Here's a really good post of theirs from Friday:

August 19 2011: One Step Up and Two Steps Back

It is really convincing to me, dealing as it does with the banks. The banks' share prices have collapsed; there have been major outflows out of the Euro banking system into safe havens like gold, USTs and US bank accounts; their credit default swaps are getting hammered; and now there's a minor liquidity crisis showing up in the Euro money market system. Not as bad as Lehman for the time being, but even Cramer makes a good point when he defends his "Lehman moment" assertion against some pompous English twat named Simon who's obviously part of CNBC's "Don't Worry Be Happy" crowd (watch the video at that link - and, seriously, do watch it).

Frankly, to me, anarchist and sociologist that I am, this illustrates not so much a "crisis of credit" as it does something more basic: a "crisis of trust".

You can't have a banking system without trust. Trust begets credit, trust informs counterparty risk, trust even informs due diligence (as those of you involved in the TSXV, the Moss Isley Spaceport of investing, already know). Unfortunately, with the stories coming out of the banking industry of endemic corruption, unmitigated incompetence, and proof of lackadaisical attitudes to risk, which have continued past 2007-8 (as you can see by the pathetic "stress tests" which failed to even simulate the possibility of Greek default, much less Euro dissolution), there's no more trust in the banks.

Even the Canadian banks have started diving. Now, they got through 2008 very well; they do have exposure to the Canadian real estate bubble, but I don't see that bubble popping unless we get simultaneous China and oil crashes. (The Canadian banks might just be getting shorted as proxy for Euro banks, since Euro banks can no longer be directly shorted.)

And SocGen, the subject of a bankruptcy rumour, is still circling the drain even after it's been made perfectly clear that the rumour resulted from a Daily Mail misreading of a fictional piece in the French press.

Trust in banking has collapsed. Probably because of extreme financial deregulation making it impossible to know what's really on their balance sheets, as well as the understanding that banks have now effectively become nationalized, with their losses now covered by increasingly indebted nations. And I bet the big boys in the investment world know this.

And I bet they know that "socialized losses" is an extreme moral hazard, that puts the stake in the heart of the proper pricing of risk - which is THE essential and only function of ALL markets.

And I bet they know how precarious the "socialized losses" paradigm has become, now that governments no longer have the money to absorb another disaster.

And I bet they know that the political support for "socialized losses" has collapsed. And I bet they know that this means when the next crisis happens, the American solution of handing out free candy to the Plutocrats will be abandoned, and the only politically acceptable path will be the Icelandic solution of raping and looting the rich, fucking the rich depositors, fucking the shareholders, fucking the bondholders, burning down whole villages... essentially, the free market solution of letting the losers lose and the winners win. With, hopefully, the kind of vigour and ruthlessness that you can only get from Vikings.

Which would be Karl Denninger's dream, so it's good to keep checking in on him once in a while.


The real reason I put you on to Automatic Earth's most recent post is because they do have a grand narrative - like GT - but they come up with a scary conclusion:

Gold goes down from here.

Agree or disagree with them if you want. But do just watch out that you pay attention to the possibility, and look for signs that it might come true.

Personally, my own market narrative right now is assuming that a crisis of trust in the entire financial system will actually result in gold returning to... oh my god I can't believe I'm going to say this... please help me... make me stop... in gold returning to its traditional position as an alternative currency.

Note I am not saying "gold standard" so all you Rondroids can go fuck yourselves.

But I am saying that, as physical gold used to make up 1-2% of the assets of the ultra-rich, they may now decide to make it a more traditional, Grandich-friendly 5-10%. That's enough to give us $2000 gold by Xmas and $5000 gold before the sun rises again on the West.

My empirical basis for this is that it's already been happening. Europeans have been buying USTs, USDs, and gold. It's portable, it's valuable, and it's not printed by gov - oh my god make me stop saying these things - it's not printed by governments.

Basically, if you can't trust the banks, if you can't trust governments, you can still trust gold. The Jews in 1930s Germany learned this, the capitalist class in 1910s Petrograd learned this, the Parisians in 1940 France learned this, the people in any Gonzalo Lira-style deflationary/hyperinflationary LatAm disaster area learned this.

Now you and me don't need gold because we're the peasant class so fucking get that straight. The peasant class survives by joining work gangs, living under bridges and eating tulip bulbs. So don't go buying fucking silver rounds on the internet like some fucking survivalist dumbass. Learn how to repair boots and electric armatures if you want to survive and thrive.

But the rich seem to be getting back into gold as "a hedge against fat-tail risk", as Bernanke calls it.

Getting back to GT:

I emailed him a couple days ago asking why silver hasn't collapsed yet. The GSR should have shot up when markets started to dive. I mean, this is a collapse in the coming. It's a "Lehman moment". So why isn't silver diving?

Is it because people are also using silver as a monetary metal now?

You think about it. I have no opinion either way. I'm just curious.

Friday, August 19, 2011

Jon Stewart does Glenn Beck

If you're at all a Jon Stewart fan I guess you've already seen this.

If not, just watch it.

(EDIT: the Nazis at Fox must have kicked the previous poster off of YouTube - as of 15 Jan 2012 I have replaced his video clip with another one. You can never win over the internets!)

And Lewis Black while we're at it:

Rob McEwen predicts $5000 gold and $200 silver

Rob McEwen predicts $5000 gold and $200 silver.

Dunno when, haven't read it yet. You might want to see if he gives you a timeline.

Otto says that Gary says....

Otto says that Gary says that gold is looking too bullish. Well... Otto doesn't say that, I guess, but Gary does.

I respond that public opinion on gold should be up at the high range... after all, gold's just busted out of its channel.

At the same time, one good day resulting in a "to da moon Alice" rush to buy is a little silly, sure, I agree. Gold trades at under 5% margin right now on CME, so you should expect some margin ups, and that might slow the price rise up a bit and give you a few down days.

After all, as we've seen today, one hour of hopefulness on the S&P 500 is enough to drive down the price of gold.

Stay frosty. Disbelieve everything.

PS and as you can tell by now, I've got the day off work.

What do you want from $HUI?

A certain mad technical analyst says he's not a full-on gold mine bull til $HUI breaks past 610.

Personally, I'm a cheap whore and will be happy to see a close above 590.

This 570-585 resistance zone is an unbelievable morass right now, it's almost impossible to get through. So I'm supposing that if it does get broken through to the upside, the April 605 point will be trivial to break through.

At the same time, CCI(40) is nearly at 100. Now, usually it flies up to 150-200 before $HUI backs off. But slightly over 100 means an intermediate peak. Thankfully RSI(7) isn't nearly over 100 yet.

$HUI's positive today so far, but it's retail hour and friday volume is light so who cares, right?

Friday video

Spice Girls!

Cos you probably are gonna need it.

Yesterday's selling and today's preopen comment

AMEX had a 94% down day yesterday. NASDAQ was a 98% down day. So, again, panic selling. Over-90s apparently can go on for a while in a panic; but outside of extreme situations they usually get negated the next day.

Gold and silver are massively up,by the way. $HUI is at its EMA(7), so this is the critical juncture - does it move back up on the increase in gold & silver and decrease in oil? That's what it should do. So if it doesn't do that, you know panic is setting in and should probably dump til the panic's over.

UK had some data come out last night saying their tax revenues were higher than expected, so maybe that gives people a very lame reason to buy back a little bit?

Let's see what happens. Off to check the premarket L2.

Thursday, August 18, 2011

You're going to need some inspiration....

You're going to need a hell of a lot of inspiration on Friday, I think. So here's some, from the greatest inspirational speaker of all time, Conan the Barbarian:

Here's what I've been thinking about today:

Here's what I've been thinking about today:

El CEO de San Jorge dijo que no se van de Mendoza y que trabajan "con el gobierno de turno"
Otra vez la Justicia rechaza un amparo contra la mina San Jorge

I dunno, for 50 cents what do you think? Jo no habla.

European money market doom

Contest - gold $2000 Globex close.

I'd like to propose a contest.

Pick the date that gold first closes above $2000.

By "close", let's define it as the 5:30PM Globex close, as shown on Kitco.

Person who is closest to the date wins. Only one pick per person, please.

Either post your answers here, or (if you're like me and find it impossible to post comments on blogspot sites when using Firefox) you can email the account eeddccbb, which is at gmail, and I will post your picks in the comments section for you.

There is absolutely no prize.

By the way, forget Dell

One story on the wire is that Dell's negative guidance suggests global growth fears.

Nonsense. The problem is that all desktop computer producers are going to see their markets contract, because a large part of what we call "computing" is moving to mobile devices like smartphones and (uck) tablets.

Personally I rarely use my desktop now that I've got my Motorola Atrix.

There are global growth fears, but they have nothing to do wth Dell. Dell has just reached the end of its glory age.

If you're some tech guru trader, maybe the pair trade to exploit this is "short desktop long smartphone".


Philly Fed: doom!

European interbank market: doom!

Apparently commercial mortgage-backed securities are also flashing doom, but I haven't found a link about that yet that wasn't ZeroHedge, so we'll ignore it for now.

These are the sorts of things I'd look for in anticipation of a major downward slide. Not only is the market diving on US data suggesting industrial collapse, but there is a major liquidity crisis brewing.

But strangely, $HUI is still at support, GDXJ and SIL are at support, precious metals are rising, and silver is even acting like an investment metal instead of a greed metal right now. (Ask GT if that means he can no longer use GSR as a liquidity indicator. I think it's an important topic of discussion.)

However, in regard to $HUI, I remember just yesterday reading a trader's "ten tricks for surviving a bad market" thingie - linked by Ritholtz I think - where he said "markets never consolidate horizontally."

Well, $HUI is moving horizontal right now. So by that argument, $HUI is topped out. Maybe you want to dump it after all? How much do you want to risk on this time being different?

Who knows. We'll see.

quit dying, you cowards!

S&P 500 crashes 5%.

Yet the $HUI is still at support. The GDXJ and GLDX have lost EMA(7) support, but not drastically.

You might want to check Kitco for an explanation. Gold and silver are up. This is that "fundamental disconnect between miners and the broad market" that GT seems to hint at.

So quit freaking out. Nothing to worry about just yet if you're in the miner space.

Wednesday, August 17, 2011

GT on the Q

GT says

Here's the rest of the motley crew, headed by the Tranny

I retort that the reason the Q is outperforming is because it's something like 30% Apple, and they've just surpassed Exxon as the Greatest Company on Earth. So of course the Q has already caught the neckline.

Though I'd like to add that my Motorola Atrix is way cooler than any shitty I-pad or I-phone.

Tranny failing to even break above its EMA(10), though, looks positively hideous. Still a downtrend til that changes.

back to the insightful analysis UPDATE 1

OK. Let me get back to casting the tarot cards and pretending to give you an insightful analysis.

This is what I was looking at over the past week in the miners, while I was too busy with work to actually put up some charts:

The EMA(7) is always supportive in uptrends and resistive in downtrends, at least with this motley crew. GDX, and $HUI, were looking good, and the only concern of mine was the big lateral resistance we're now hitting at 580. It's looking toppy, frankly.

But then I started looking at the other miner ETFs. First, take a look at GDXJ, the junior golds:

It's nowhere near as impressive as GDX or $HUI. It's nowhere near the July high yet, for one thing. It's a long way from the April high as well. And it's had to fight hard just to get over the SMA(50) and back into some slight semblance of an uptrend. MACD is trying to cross over, but to me that means nothing. This isn't a convincing chart, to me. Maybe we'll see it take leadership from GDX? That would be somewhat more positive - though again, if GDX can't punch through resistance, it'd just indicate we're in the last 2-3 days of a bull move.

Now let's compare GDXJ to the silver miners, SIL:

To me, silver miners ETF looks better than the junior golds ETF. At least it's fought its way back above its end-of-May high, and the upward slope of the present uptrend is more impressive than GDXJ's. But meanwhile the RSI(7) and CCI(40) aren't showing an overbought condition yet. And it's punched through some recent pivot points with no hesistation. So, that's not really so bad.

Now, by the way: why should junior golds look weaker than senior producers? You tell me. What don't the juniors have that the seniors do?

Anyway, for comparison, here's your chickenshit penny-crapper moose pasture ETF, GLDX:

To me, this one looks positively terrible. Yes, it's just now gotten above its EMA(7); it'd look better if it could get above its SMA(50), though - even though that would still leave it in a medium-term downward channel. Getting above the SMA(50) might make the MACD trigger up, which might mean we get more upside everywhere before the ultimate doom hits us, this month or next.

Whoah! Ultimate doom? This month or next? What's that all about?

Well, if you want to figure out where I'm getting this "ultimate doom" stuff from, just look at my coup de grace, the copper miners ETF:

If the explorecos looks like death warmed over, the copper miners ETF looks like one of those patients on House who's just pooped a lung. It's stuck below 2 pivot points and doesn't have a slope that would suggest any conviction that it'll get over them anytime soon. It's so bad that it looks like all it's doing now is a gap fill. It's so bad that if it punched back below its EMA(7), I'd sell everything in a heartbeat and go live in a cave somewhere with a 50-gallon barrel of soy and a few shotguns.

These charts tell me:

Don't invest in crap right now that is based on industrial growth or demographic-driven demand. Because the market doesn't think we're going to be having any anymore.

Don't invest in the risk-on stuff (like the explorecos).


But at the same time, for the time being, for short-term play only, so I can make me $3K/wk quota, I'm happy to invest in stocks with very short-term drivers, if they're actually pulling shiny things out of the ground.

But I'm keeping one eye on the exit. I have cash at the ready, and the names of some triple-short ETFs on a piece of paper beside my monitor.

Now. I had just read last week on someone's blog that the Rydex bull-bear was at a bottom; that would mean we would have been set up for a nice little snapback rally.

OK. That's fine. Bullbear is pretty neutral right now. Maybe this can last for a month or so before we collapse into a seething morass of doom. But I wouldn't expect the bull-bear ratio to go over 1.5 - check the left side of the chart. Eventually, if people see that going bullish is no longer a good idea, they will clue in that going bullish is a bad idea.

Oh.. and Grandich says that the 1260 neckline is "the mother of all shorting opportunities".

Bespoke again

Like I said, go subscribe to Bespoke's reports. It's the same price as Otto's or GT's newsletter and gives you a good statistical view of the broad market. For whatever other nonsense you're picking up in the media (or god forbid the internet), the cold hard stats of Bespoke are a good antidote.

They put out a nice little thing tonight where they point out that every single time the market has dropped 15% in 10 days, it's gone on to drop another (median) 15% over the next 5 months!!!!1! The one year median return is just a shade over zero, the 3-month median return is a shade under zero.

Now, the results are heavily skewed by 1931, which was an extreme outlier. (Um... unless, of course, we're just repeating the 1930s right now.) In fact, the more recent the initial market drop, the less severe the aftermath has been. But then again, disproving that very last statement, the most recent such drop was 2008-2009. Which... again was one of those Depression-style "you're only halfway there" crashes.

Nevertheless, the sum of all of this still remains:

Louis James in the Gold Report

Louis James was in the Gold Report. His buy recs include Guyana Goldfields, Pretium, and Sunward.

I'll just leave it at that.

BCM's going up, looks like

BCM's L2 is showing me a pile of iceberg buy orders - 28 at last count. They aren't chasing the stock but they certainly are interested in buying and keep squeezing the bid-ask.

These guys often disappear at lunchtime, when retail wades in, then let the price go down for a bit before coming back into the market around 1:30 or so.

So assuming everything else looks good in the broader market, you might want to buy 100,000 BCM before they do. :-)

In any case, $4.05 isn't a bad price to get in on it. Especially if, say, you've already bought a pile at that price before and then sold it later at $5, like certain rogue bloggers from Canada.

Still a ways to go

For future reference, the S&P H&S neckline is around 1260. Certain individuals call that level an epic shorting opportunity. It's up to you if you think the S&P can go above that, but to me all it means is we have a way to go in the broad market before everyone's going to start looking for the exits.

green light for gold miners

GLDX, GDXJ, GDX and $HUI all up, $HUI breaking over 580, gold and silver up, S&P 500 up. Looks like it's clear sailing, expect fear to decrease, greed to return, buy all the miners you want I guess?

Tuesday, August 16, 2011

gdxj/gldx no longer lagging

GDXJ and GLDX are holding the EMA(7)s that they just won yesterday. So the juniors an shitty explorecos are technically looking bullish. But meanwhile GDX is downish - still above its own EMA(7), but starting to look a bit toppy.

Now maybe that just means that there's no more gas in the tank for the majors, and so the lemmings have started buying up juniors and shitty explorecos. I.e., that's all that we'll see from this $HUI advance, and soon the bottom will fall out of everything.

Germany is falling into recession according to data released this morning. USA's already back in recession. Correlation is very high, and $VIX is stubbornly up in the 30s still. So maybe there's more of a drop coming in the broad markets. That should colour your consideration about our near future.

Then again, if you're a more medium-term person, $HUI painted a higher low that the SPX would only be able to dream of at this point.

Anyway, I dumped a bit more stock for a bit more profits, but am willing to buy back loads at the right price. E.g. today GOZ looks weak, so the shares I recently sold at .84 I have now bought back at .80. I might want to pick up some FVI. I find USA frustrating and might take profits and hope to get back in at .58.

All Otto's subscribers who bought up Estrella to well over $1 might want to take a look at it now - you can get all you want at .75. That's probably going to apply to Regulus soon enough, I think.

I've been seeing Argentina election news on the Reuters feed, so I'm wondering what to do about that crappy copper play in the middle of nowhere in the province where they don't like mining. Not telling you which one it is because I want to buy it before you, for cheaper than you. Because I'm bad.

preopen comment

European market down a couple percent, because now Germany's entering recession. England was broadly down, except goldminers looked strong - so we'll see if GT's thesis holds. I doubt it, as I've read elsewhere that markets have become extremely correlated - the type of herdism you historically see in market crashes.

So generally, lt's see if the fear comes back today. $VIX slipped below its EMA(7) yesterday - I wonder if it'll pop back up? GDXJ and GLDX were unimpressive yesterday - let's see if they fail and drop? $HUI hit its resistance of 580 yesterday - let's see if that begins a downtrend again?

Strong point is, there's a lot of strength in my miners, according to the preopen L2, which isn't much. BTO, AR and RIO look to open strongly higher.

Monday, August 15, 2011

a few hours later, $HUI comment again

$HUI's looking a little stronger now. But I would still rather wait til it breaks 580.

GLDX is still crappy, that's what I don't like.

quick comment on HUI

HUI is in a small descending range. However, it's still getting support from its EMA(7), so this miht just be a "pause that refreshes". Nothing in the broader market looks scary this minute. Look for HUI to stay above, say, 555.

GLDX and GDXJ look toppy and about to fail support, however. GDX looks good. So it's still the senior miners who are leading here. And they're not doing particularly well by my estimation. So I've got a lot of cash and intend to round up a bit more unless $HUI goes above 580. Anything less than that will look toppy with a lower high.

BTW... some newsletter writer's followers went and bid up Regulus to $1.60 today. I don't know why they can't just put in a limit buy order. They're literally giving away 20-30%. I have always waited 2 weeks after a reccy, and have gotten a price equal to what it was before the reccy came out.

I'm not saying pinch your pennies. But I am saying it's fucking idiotic to bid up a zero-liquidity stock, that far, on a Monday morning.

Sunday, August 14, 2011

search results

Got a hit on my blog from someone who ran the following search:


Hm... wonder if he's vain enough to look up what bloggers think of him? Cos, y'know, pride is one of the seven deadly sins. Along with wrath, greed and envy, I'm only sayin'.

I can proudly say "I'm a Satanist, just not a very good one". There are lots of theological reasons for saying that; I can explain it all to you if you want, someday.

But generally, I feel that most religious people should be forced to say "I'm an X, just not a very good one". Just think of how much religious strife would be ended, for good, if only every bullshit pronouncement had to be prefaced with "I'm a Christian, just not a very good one", and every fatwa started with "I'm a Muslim, just not a very good one".

It's honest, it's true, it's humble. Try it sometime.

quickie before bedtime - Sabina Silver

Quickie here.

GT kinda got bummed out a few weeks ago by Sabina's recent price action. Reading the mining stock bulletin boards, I came across someone point out that some recent financing shares became free-trading on Aug 2nd. Which is when SBB jumped off a cliff at $5.75 and fell to $4.50. Might have been exacerbated by general market willies, of course.

I just pulled up a 1-year chart for SBB and saw it has a lot of major support at $4.50. Its next support-resistance line is $5.75. So... if you wanted to buy some at $4.80 if it gets there, use $4.40 as a stop-loss and aim for a $5.60 sell, that's your 2:1 return/risk right there. If you can get some at $4.60, that's 5:1 return/risk.

Of course you'd have to be a lunatic to buy a silver miner in this environment. Right?

Again, apology

Again, sorry for not having posted much in the past few days, but work is an utter bitch. I put in 17.5 hours this weekend - and I'm usually a part-timer. I'll have to put in another 15-20 hours by Wednesday, before I can have any time off.

Short story, stupid dumb fucks leave me hanging til the end and then expect me to give them a $50,000 design in 4 days. What's worse is I'm so fucking great that I transcend god, so I can actually do it... sort of.

Anyway, I'm only now reading my subscribed newsletters, but felt I had to give you some doom and gloom. As I said, I subscribed to some Reuters feeds, and ditched the "Business News" feed that comes with Android as I felt is was too childish and mass-media. Here's something I stumbled across on Reuters:

  • Um... the story does also get play among the ZeroHedge crowd, as a quick Google search will tell you, so maybe you don't want to put much stock in it.

    I forgot the rest of the doom news... oh, there was the thing about the US consumer confidence being the worst since the 80s. Did I mention that yet?

    GT points out that the gold miners' fundamentals look great when viewed from a $GOLD:$CCI perspective... which is funny, cos it usually does that right around a market crash. I'm happy to hold producers as long as the charts look strong. Oh... but on Monday, instead of just watching the $HUI, you might also want to watch GDXJ. It's getting squished between the SMA(50) and the EMA(7). And GLDX still hasn't broken above its own EMA(7) yet. If both of those fail, that suggests to me that risk goes up for the big producers ($HUI/GDX) and you have to watch to see if the $HUI gets repelled yet again by its 570-580 resistance. The $HUI candles have long bottom wicks, and the candles aren't moving up very strongly. Might soon want to short the gold miners.

    Meh... I'm too tired for insight. Go and RSS Ritholtz if you want real insight. Again, he actually trades for a living, unlike most of the morons you find on the internet, so his opinion's gotta be worth something.

    Oh... and Otto Rock is quitting blogging. :-)