Gold and Silver Current Thoughts 3-19-2015

From the Trading Desk

Yesterday’s Federal Open Market Committee release had, yet again, confusing dichotomous language which left market participants unclear on the intended monetary path going forward.  On one hand, the Fed finally removed from the statement a promise that they would be “patient” and said they would consider raising the benchmark rate as early as June.  If this were the only message, it would have been decidedly bearish for the precious metals.  Of course there was more commentary to further muddle the picture though.  The Fed downgraded their quarterly forecasts for economic output and pushed back their expectations about the pace and timing of interest rates increases beyond this year.  Rates are now expected to reach only 2% by the end of 2016 and 3.15% in 2017.

The markets ultimately interpreted the Fed meeting as dovish.  The USD gave up substantial gains against a basket of currencies and the euro shot up over 4%, a huge intraday currency move.  Gold had been trading on thin volume in a tight range pre-FOMC and then catapulted higher during and after it.  Gold finished the electronic trading session up about $20 (1.75%).  While it did have an impressive move, it remains range bound.  Offers have materialized in the $1,175 area and this now represents a double top from yesterday and today.  Until this level is decisively broken, it seems like rallies are being faded and sold into by speculative traders.  Silver has managed to have more of a break out than gold, at least from a technical perspective.  It tested the $16 handle yesterday and has sustained the move above it with a close above this level today.  Near term resistance is at the 100 day moving average of $16.45.

It was a ho hum day for gold and silver. Nonetheless, you could have got a play out of JNUG at a break of 17.43 without getting stopped out and rode it as high as 18.87. It closed at 18.26. The same breakouts occurred in NUGT, GDX, and GDXJ. There really is no reason to look at JDST at this juncture. It could fall to 10 or bounce to 13.54 depending on what gold does. Stick with momentum plays instead of guessing.

Speaking of guessing, if anyone bought the dip on DWTI, they woke up this morning with a big smile on their face as it was up over 23 points early on. It really wasn’t a tradeable play though after the open and was somewhat flat the entire day. UWTI fell all the way pre-market to where it took off from yesterday. The deflationary forces took over quickly today with the dollar rebounding overnight putting pressure on all the big winners yesterday.

RUSS was a potential play at 13.69 and could have been held to end of day where it closed at 14.25. It could make a move here if things stay shady in Russia and would be a real nice hold to over 15.59 if it can get there. From there it can hit 18.22. We tried this once before. Let’s see if this time it can make it. I would keep a stop at 13.50 at this point if you are long or contemplating a trade tomorrow.

UGAZ gave it a try this week, but just can’t seem to get past the 3 level too easily. It’s on a downward path again and I would look at a break of 2.54 to confirm a long in DGAZ is to be held. DGAZ was a buy at 6.28 and only went as high as 2.55 before closing at 6.34. As I have said all week, these are difficult ETFs to play this week.

TNA ended positive for the day and still in bull territory despite the fact the DOW was down 117 points. Are we getting toppy in the stock market? TNA is at 52 week highs, so watch TZA on a move over 10.26 – 10.33 for a play, with stops.

SVXY and UVXY you would have got stopped out of today. These are more difficult plays than the above. I guess that’s what happens when you trade “expected volatility.”

Gold and Silver Stock Mining Package – Release date shooting for Friday 3/20/2015 – If you are signed up, look forward to an email announcement this week. If you haven’t signed up, read below. 

The mining package that we will be offering has been waiting for a release at a time that I feel would coincide with my overall view of gold and silver prices reaching the lower targets I think they can fall too. Many so called experts last year in July thought the miners would take off and next thing you know they broke to lower lows. Some called this latest run up the final fall for the miners. It obviously hasn’t been and I know that’s frustrating for many who are long or have been long for some time. There is a reason why I have been patient with the release of the mining package. There is also a reason why I chose the stocks I did and I’m excited about their potential. The mining package release date will be announced soon. I sent out an email to all who have subscribed recently with an update. If you haven’t signed up, read the following and express your interest.

For those who haven’t signed up; We will be coming out with a mining package where we pick what we believe to be the best mining stocks to buy based on my research the last 8 months. We have been patient in releasing this because of the timing in purchasing these mining stocks can be tricky. We were one of the only one’s who recommended selling mining stocks in September of 2010 when the HUI was trading at 512.56. Much has transpired in the mining industry since that call with many companies disappearing or being taken over. Today many companies are struggling and if we do get a further pullback in the price of gold and silver, more companies will go bankrupt. Knowing which companies have the best opportunity moving forward will be key to you getting returns that we believe will be in the 100% to 500% range, and possibly much higher for some of the miners. This package will be released in the next few weeks and we will announce it on the site.

If you are interested in this Gold and Silver Stock Mining Package let us know by clicking this link below and completing the form.

Gold and Silver Stock Mining Package