In yesterday’s Current Thoughts I said to expect some volatility today with the Fed’s minutes coming out from their December meeting. We got just that as you can see from the charts of both JNUG and JDST below. Down, up, down, up, down. That’s the definition of volatility.
We are still technically in an upward trend and the risk reward is on the side of being long the metals as long as they stay with the green arrow up. Look tomorrow to see which way the metals go as to what to trade. Gold and silver are up slightly in Asia.
UGAZ took another hit today reaching a new 52 week low as DGAZ was still hitting higher highs. We may not reverse this trend until Thursday’s report. It might be worth a long if we get a further dip into Thursday morning but realize the knife you are catching is sharp and it seems we want to test the 2012 lows in Natural Gas despite colder weather in most of the U.S. (but not here in California).
I said yesterday that TNA offered you the better risk vs. reward instead of TZA and TNA was up 3.63% on the day closing at $75. We should now test the 80 mark but still look for economic data that comes out that can reverse direction and be willing to take profit and reverse your psychology and play a higher high in TZA if that occurs.
RUSL took off without us moving 12.32% higher. It’s a more volatile play than most and difficult to catch the daily trend as it bounces in both directions. Today would have been a good day to trade it once it broke yesterday’s high, with stops.
We finally got a bounce in UWTI but most would not have been able to catch it since it gapped up to 3.51 at the open and closed just 3 cents higher than that price. Look for a buy if it goes past today’s high of 3.70, but keep stops as the oil knife is also very sharp on this downtrend. If it does go past 3.70 and we have reached a short term bottom, this could be a good ride. I find that hard to fathom though.
Couple things to point out. The dollar is now above 92 with all the problems in Euroland, and the 10 year treasury yield is below 2%. These are acting as safe havens along with gold at present.
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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