Gold and silver before the New Years holiday really didn’t do much but of note was even with the prices not rising above $1,190, the mining stocks did quite well and JDST broke down. Both metals have opened higher in Asia and they seem to want to go higher but I’m not convinced until gold is over $1,200 and silver over $17 which seem to be offering good resistance.
This week we should see more volatility with traders back from their vacations. We have a lot of economic data coming out as well as the minutes from the most recent December Fed meeting. Expect swings both ways that can be playable for a trade.
Those waiting for my “all in” call will have to be more patient. In writing my 2015 predictions article this week I will be referencing again my 8 indicators I wrote about last July that helped me call for lower prices in the metals. Please review each indicator I provided and see what I see and tell me what I’m missing. These indicators won’t stay this way, and I do look at more than just these indicators, so keep the faith in the future appreciation in the price of the metals. I will be more bullish than anyone when the time is right. Markets can turn quickly as we have seen in so many other countries. That’s why I am writing my current thoughts 5 days a week now. I want my readers to know when will be the best time to allocate your last investment or even first investment in the metals. In the meantime, I still preach to dollar cost average into your overall allocation you wish to put in metals.
Natural Gas is up over 4.5% as I type. UGAZ will open up with a nice 10% plus move if this holds. It might be a time to lighten up on longs if you are profitable. If not profitable, then it may be a longer wait for profitability, but it will come. There is a warm front hitting the West Coast. Meanwhile it’s pretty cold most everywhere else the next 5 days. Maybe Natural Gas took note of that with this rise. Either way, it has been rather volatile and DGAZ may be the play with stops after this run up. Before New Years UGAZ had a nice run up but gave most all of it back by the end of the day. Maybe this pattern will repeat tomorrow. Keep an eye out for lower lows in UGAZ and higher highs in DGAZ to play long (or hedge for a trade your UGAZ long).
Is oil bottoming? No! UTWI and USO are still on the backburner for going long. Oil is down 1% again overnight. Will it break below $50? Looks that way. Trades will come and look to go long UTWI with any higher high.
TZA has been a nice trade since I called it under $12. Move your stops up on any gap up tomorrow and take profit. Lots of data coming out this week that can take the stock market higher. I’d rather wait for a trend to develop at this point. We had a little profit from the TNA trend leading up to Christmas and now a smaller profit with TZA after Christmas. I just don’t know yet if it has legs. So simply move your stops up.
The U.S. Dollar is now above 91 but gold isn’t really playing opposites with it. One will give sooner than later and I think it will be gold. Europe, Japan and Russia are all experiencing problems as they deflate or implode.
I expect more weakness in RUSL and at some point it will become a trade. Too risky right now.
NOTE: Will be calling this report “Gold and Silver Current Thoughts” from now on to coincide with category.
Doug Eberhardt is a 28 year financial services veteran and precious metals broker selling gold and silver at 1% over wholesale cost. Doug has written a book to help investors understand how gold and silver fit into a diversified portfolio, how to buy gold and silver, and what metals to buy. The book; “Buy Gold and Silver Safely” is available by clicking here Contact phone number for Buy Gold and Silver Safely is 888-604-6534
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