Friday, January 27, 2012

changed my mind a bit

Tried to play HZU today. Failed. Silver's not looking like it wants to move. Dumped at small loss.

Bought back my BTO. Yesterday's thesis was obviously incorrect, and BTO still has strong volume behind it. Maybe it can hit a 4-handle? Anyway, only lost out on about 12 cents of the present upmove.

Dumped HMU. Doesn't seem to want to go anywhere anymore. UUP might also be due for a breather in its downtrend, which would hurt it I'd assume.

As I said above, yesterday's thesis (bearish abandoned baby) has been disproved in the $HUI chart. We could have what I call a "bearish abandoned boobies" in the GDXJ chart if we get a downmove on Monday, though. We'll have to see.

Nope, looks like this has a bit of life left in it. So while I do have decent cash on hand, I'm happy to stay in the market over the weekend, I think.

Got tin?

Something funny happened to tin.

No clue what's up. But this looks nice.

Geologix

GIX has popped volume-wise on a couple pumps from Grandich on his blog.

My own ignorant newbie interpretation is that they have a deep gold deposit with the kind of strip ratio I don't like; then again, their project's NPV is about 30 times their present market cap at spot gold price, so maybe strip doesn't matter so much in this case eh?

I figure, a pop of 12 million shares in one day can't be that bad. Especially when it's been bottomed out so bad over the past few months. And while I haven't yet read up on the property, the NPV calc can't be so far out to make this a joke. So meh, threw $5K into it.

I hear already the retching at buying a Grandich stock. But we're already in an environment where even the crap is going up in price. And $5K isn't much.

UPDATE (12:15): then the drugs wore off. Sold my position back to the market for smokes money.

No seriously, the volume seemed to die off, and I figured I'd better get out if retail was the only guy left at the table. Would seriously think of buying back, but only on a bit of a pullback.

Thursday, January 26, 2012

risk management before the close today.


Some bad things in this chart:

1. Lack of follow-through. The high volume got us nowhere today.
2. RSI(8) in overbought territory.
3. This comes after GDXJ went beyond the 2nd standard deviation (%B chart, bottom).
4. The candles for the past 2 days are the first 2 symbols of the bearish abandoned baby candle formation. I'd wager the 3rd ( a big red down candle) will want to manifest itself on Friday.
5. GDXJ has failed around $29 before.
6. Some people expect S&P 500's top to be around 1340. S&P 500 reversed away from that area today.
7. UUP also is at its 2nd SD below normal; I'd expect $USD to catch a bid at least for a bit. JNK:LQD also seems to want to ease off. And $VIX's RSI(8) has been a little oversold for a bit.

Given the above, I figured the risk-return ratio is now different for the short-term future. I'd expect the $HUI/GDXJ/miners to probably retrace down at least to their EMA(8); seems likely, as that's close to Monday's high. Will it happen Friday? Possibly. Or the miners could simply take a breather for a couple days.

So if I feel there's now higher risk, and less return left on the table, I should maybe raise a bit of cash. So today I sold my BTO at $3.70 or so. BTO had weakened a bit this afternoon, with a lot of volume piling in and selling; so why not? The sale gets me to a 5% return on capital for this month, which is what I'm aiming for each month.

I still have only about 27% in cash, and a lot of things that I can still sell at a 10-15% profit; but if we see a rough day on Friday, I can jump back in and buy a few things for cheaper than they were today.

And I'm sure all the other junior gold investors are thinking the same thing.

If I do jump in, I must remind myself of something, though:

Another mistake of mine, over the last year, was when I sold a good stock at a profit (like FVI, RIO, BTO), and the market continued advancing, I'd end up redeploying that capital into inferior stocks - explorecos, for example. I want to make sure that this year, I stick with best of breed and not move my money into garbage when I perceive more upside in the market.

Anatomy of a successful trade?

I've been wanting to write an "anatomy of a successful trade" post, but unfortunately I keep wanting to make it nothing more than the following:

1. Bought it low
2. Then it went up
3. Sold it higher

And I know for a fact that such sarcasm is completely unappreciated by my readership.

Actually, part of my "this year's strategy is to not fuck up like last year" strategy has required me to hold onto the positions that I bought that are now higher. Certainly, a few items have been sold: I've dumped some GOZ at a slight loss, got rid of my AZC position at a slight win, trimmed my excess SBB after it awoke. But my major wins - FVI, BTO, AMM, NGD, HMU, the rest of my SBB - are still being held.

Why? Cos they've broken out. I don't know how high they're going to go. I have seen no chart signal to sell each of these stocks, I have seen no macro reason to sell them, I have seen no liquidity signal to sell. So you hold what's worked so far, and squeeze a few more percent out of it.

The best example is BTO.



I bot mine at $3.10, just like anyone with half a brain could have done at any time over the past month, with the justification given that not only is BTO's production stellar, but they also have some great exploration properties with newsflow coming.

Now it's at $3.80: why sell? 4 out of the past 5 days have printed large white candles, so I could have sold on each of them and felt clever... until the next day.

Also, volume is the best technical indicator, as Joe Fahmy says; and the volume on BTO has also been stellar. Those few idiots remaining who've been selling BTO cos they didn't like their new Namibian direction are now swamped out by those who recognize that BTO is a much better gold company than anything you'll find on the godforsaken $HUI.

So, outside of buying $10K of SWD on the drillbit news out this morning, I've been pretty much quiet on the buy/sell front and will continue to be until the mood changes.

Notice: playing field chaged again

S&P went up despite US Treasuries also going up. The US 10-yr is back to 1.96% after having dipped below 2%.

Oh and also, Italian 10-yr yield is now back down to 6.00%. And Spain's now down to 5.15%.

I'd almost expect S&P 500 to put in a red day today; the question is, what will happen with gold and silver.

UUP is down strongly, yet JNK:LQD is priting an inside day. The latter might just be a Fed statement artefact, but I have no idea even if what I said there even makes sense.

An overly cautious tech analyst might say that he wants to see GLD:SLV below 4.8 before assuming that we're out of the woods just yet. It's 5.1 now.

AEM, K, HL and HMY are all up, despite the fact they all suck. Don't believe the $HUI hype - keep using GDXJ for your metric.

Wednesday, January 25, 2012

I just sensed a tremendous disturbance in the force....

Apparently Sprott had a tuna sandwich for lunch today. Result: silver's up 3%.

Or something.

Doubling down on Sabina this morning all of a sudden doesn't look like it was such a bad idea.

UPDATE 13:36: And lo, a vast and glorious enspoogement of money into my wallet. From, uh, people who didn't want these stocks 2 hours ago. Cos, uh, that's when I bot them.

Really sad. Days like this screw everything up. Look, even the shitty $HUI has shot back up to 520. Now I can no longer mock AEM's Sean-Boy and K's Tye Burt.

Agnico also sucks by the way

Hilarious to open up Morning Coffee and see that, of the only eight stocks listed for "notable 52-week lows", one of them is Agnico.


Oh dear... that does not look good. Wow. I mean, down 50%? Wow.

I wonder what the longer-term action is....

Oh dear.

This reminds me of my sarcastic post of a few months ago to all the gold miner bagholders: "at least you didn't buy solar".

What's up with that? Running out of gold, are you, guys? Cos last I remember gold was doing this:



There seems to be a negative correlation. I mean, between the price of gold and the price of a company that supposedly mines it. As in, over the past 3 years gold has doubled in price, while your shares are down 50%.

Wow. I mean, wow.

Anything to say about that, boys?

Lotta nice suits there. Lotta pretty smiles. Market verdict: utter absence of gold, apparently.

FLASH: SHOCKING DAVOS FOOTAGE

I was looking around on YouTube when I found this SHOCKING FOOTAGE OF THE TALKS AT DAVOS.

It seems David Icke was right.

Watch:



Davos... Davros... whatever.

continuing on about how Tye Burt and friends utterly stink and are useless

OK, here's the daily Huey:GDXJ ratio charted for you:


Obviously, the major gold miners really fucking stink big-time. This is a trend of -20% over a month, no rebounds, no bear rallies. I wouldn't buy this chart. I would buy its inverse in a fucking heartbeat. It's unrelenting.

But that's not what's most interesting. The weekly is interesting:

The weekly suggests to me that, by analogy to last year, not only does the $HUI suck compared to GDXJ, but we could reasonably expect that this major producer suckfest might continue sucking for another 20 percent or more. Without even printing a lower low.

Wow. Guys, you really fucking suck. I mean seriously.

Arguments for and against Sabina Silver

Sabina tends to go all digital-flatline when the volume disappears. Then volume comes back and you can flip it.

As in "Step 1: buy Sabina. Step 2: ??? Step 3: Profit!!!"

Not only is today's volume low, but if you DO decide to go and hit the ask, watch the L2 when you do it - those 7 asks at $4.00 instantly disappear and reappear at $4.01, the 14 bids at $3.99 follow you to $4, and you only get 700 shares of your expected 2500 fill. I.e., the robots are running the stock, just waiting for some humans to come in and buy.

I like playing against the TSX robots - they're fucking stupid compared to the NYSE robots.


And, of course, the other side of the coin is the chart of SBB vs SLV since the silver bottom in December. By this chart, SBB does sort of suck. Kinda hard.

Oh - and by the way - everything you ever knew about money-printing and inflation is wrong

Came across a great post last night, by Dan Alpert, on Ritholtz. Very difficult to understand unless you actually know your economics theory (I don't, so I call it "very difficult to understand").

But still, while I'm ignorant on the topic, I've always had this knack of simply knowing when a thesis is right. Probably due to a highly cybernetic/holistic way of thinking. And this one just seems very right.

Anyway, here's the article. Read it. Especially the part about "Warren Buffett walks into a bar". The author has a very stunning, and (if you're not a dogmatic Chicago school/Rondroid loon) convincing argument about how, in certain economic environments, like the one the world finds itself in right now, you can print all the money you want and not see any inflation. Or, at least, any inflation you might see won't be the result of money printing.

Extrapolating to the commodities scene, the argument doesn't say there won't be commodity inflation, I don't think; after all, commodity prices are ultimately the result of demographics, and demographics always trumps economics. But there won't be all the other inflation you Libertopian buffoons expect to see; I guess maybe his argument is that the "other inflation" also gets trumped by demographics.

This is an article that's got a lot of reprints on the net; I expect to see a lot of commentary about it in the future. However, I especially expect to see a lot of dogmatic wilfully-blind ignorant commentary about it in the future, so I've not got my hopes up.

Read it.

Let's address some concerns....

In case you're worried....


Yes, $HUI sucks the big one. By my own metric it sucks, as it has dove below the EMA(8). Hasn't printed a lower low yes (got a few points to go yet), but isn't looking hopeful.

So... gold miners suck, then?


Apparently not. The GDXJ looks fine.


And Yamana is a $HUI component, yet its chart looks perfectly acceptable. Not worth buying, maybe, but definitely not a screaming sell.

So again, it's not that gold miners suck... it's that the gold miners who make up the $HUI mostly suck, and thus the $HUI is going down because it's overloaded with suck.

And speaking of charts....



Silver is simply backing off to its EMA(8) after a strong overbought day.

Going back to the $HUI... RSI(8) is getting to the point where maybe we'll see a bottom in the next day or two, even in the Index of Suck.

Tuesday, January 24, 2012

Top 10 retirement havens - better learn Spanish edition

Just found a fun story on Marketwatch - top 10 most affordable and nicest retirement havens.

Funny nuff, the list is this:

1. Quito, Ecuador
2. Panama City
3. Tulum, Mexico
4. Kuala Lumpur
5. Medellin
6. Queenstown NZ
7. Granada, Nicaragua
8. Barcelona (probably no argument there)
9. Thailand generally
10. Roatan, Honduras

Not quite what you'd expect, is it?

Monday, January 23, 2012

How doomed AZC's Rosemont is

News articles on how doomed my AZC investment is!

Arizona Daily Star: Rosemont permit hits EPA roadblock

Rosemont Mine Truth: Yadda yadda save the whales man

And so on.

Sounds good!

what happens now - the answer is clear

And btw, since my "what happens now" post about the $HUI of a few days ago is the most popular one here today, I'll just point out that it looks right now like $HUI painted a higher low at 500, and is now mulling over the option of moving up. That was our option two. Good buy point given.

It's still below the EMA(8), and weighed down by shitty miners that can't turn a profit, so $HUI/GDX is not sufficiently attractive. But GDXJ is very attractive. Still going up. BTO is one of the components of GDXJ. Go check out the rest, maybe?

dude gots da happy feet

"Augusta Resource (C$2.87, -C$0.38, -12%) said the U.S. Forest Service has extended the comment submission period for the draft environmental impact statement on the Rosemont copper project to Jan. 31 from Jan. 18 due to a technical email server problem."

Cuzza dat, AZC pukes down 12%. I figured hey, may as well buy. Apparently some people are scared that a few of the US environmental agencies are going to use the extra 2 weeks to kibosh the project. Personally, all I see is a stock dumped back down to its end-September price - a price which, by the way, also resulted from a dump caused by fear of US government environmental agencies.

So I got $10K in AZC.

Also figured to pick up $10K in GPD, given it's one that GT still holds. It looks to be yet another of those "once upon a time people liked Yukon mining stocks, then they puked them down by 80%" plays - you know, like ATAC. Meh, chart seems to have bottomed, and maybe we'll see a big run-up in junior plays between now and PDAC? Besides, they apparently have some cash flow. And drilling in Feb, I think? I'm not paying significant attention. Chart sez up.

Also picked up some NGD at $10.44... chart looks to want to move up, figured why not.

It's easy to make these picks when someone recommends them, and when I've already picked up good profits (only some cashed in) with FVI and BTO. As well, SBB finally looks to want to move up. A cluster of icebergs were just sitting there, providing a wall of support, and nobody was selling into it. That makes me want to buy more.

Also (didn't want to say this before in case I jinxed it) I doubled down (herp derp) on GOZ last week... I figured 70 cents was a stupid price to be offering, so I hit the ask and found it was an iceberg offloading a big position. I figure eventually it'll get bid back up to my average price, so why not pick some up for myself. I read a report on Astur, I'm not selling.

no comment

silver up BTO up FVI up ZJG up gold up.

Thus no need for comment.

Dumped some FVI, plowed that into SBB cos you'd think their price should go up. Also bot HZU, silver double-long, since what the heck this ride isn't stopping right now, is it?