From the Trading Desk
Since the Federal Open Market Committee meeting last Wednesday, gold has traded higher for five consecutive sessions. With a strong weekly close on Friday, it finished out the week trading above double top resistance at $1,175. Its ascent has continued so far this week with the psychological level of $1,200 as the next near term target to watch for to the upside. Silver’s move has been even more impressive than that of gold. Since Wednesday of last week, silver is up nearly 10%. It moved easily through its 100 and then 50 day moving average and if it can close above $17, there is no major technical resistance until the 200 day moving average at $17.82. While silver tested its 200 day moving average four days in a row in January, it hasn’t achieved a close above this key technical indicator since August of 2014.
The dovish FOMC meeting last Wednesday was followed up yesterday by commentary from Fed Vice Chairman Stanley Fischer that further encouraged precious metals longs to add to positions. Fischer acknowledged that raising interest rates will likely be warranted before the end of the year but remarked that there are no plans for it to be a steady rise. This is because a steady path of interest rate rises does not factor in economic surprises such as the plunge in oil prices or geopolitical concerns.
Today wasn’t a great day to trade much of anything. Recognizing this is important so you don’t churn your account. The data didn’t do much to help or hurt the markets today. Tomorrow’s durable good report may not do much either as we wait for Thursday’s job numbers and Friday’s GDP report. All is well in the economy, right? We also get consumer sentiment Friday and Fed Chair Janet Yellen speak late afternoon after the markets close.
Wasn’t a big moving day for the metals but they did move higher and it was a rather choppy day for the mining ETFs as they closed about where they opened. Nonetheless, JNUG did eke out a small gain to close at 22.40, up from just under 18 on this this move. It looks to me like it is gearing up for a move but may be dependent on what the dollar does as it moved back above 97 on the Index. If we get a move higher again in the dollar, it may bring this move higher to a sooner than expected close. JDST fell again as has been the trend. I’d need to see a move above 9.83 to have an conviction that it is back in play. JNUG is still on course to hit 25 where it may find some resistance. Move your stops up to 21.25.
First sign of weakness for gold will be a fall below its 10 day moving average of $1,161.20. For silver a fall below its 10 day moving average of 15.88 is the spot to watch.
Market seems a little toppy right now for stocks and TNA had a 4 cent loss. Yesterday I said to look for a sustained move above 9.93 for TZA and that seemed to provide resistance. Tomorrow see if TZA can muster a move past 9.93 and especially 10.12. Bulls can’t always run and sometimes need to take a breather. I just try to make you aware of what I see so you can take profit. That’s the name of the game!
Oil and UWTI started the day off nicely, but spent the rest of the day in a downward trend after a push to a higher high that trapped some bulls on a fake breakout. UWTI closed up only a penny. DWTI had a tight range it traded between all day and really couldn’t gain momentum. Jury is out on these tomorrow. Look to the dollar for some answers on which way to trade.
UGAZ did join the lower dollar rally finally, but closed lower than the open and only moved up 4.60%. This isn’t a move as much as it is a counter trend rally. Probably won’t get much action until the storage report Thursday, but keep an eye on it as at some point it will develop into a nice swing trade. For now it is still not attractive to me. Both UGAZ and DGAZ had terrible volume which shows that traders are looking for the action, not these two dogs.
Volatility was down yet again with UVXY hitting another 52 week low. It bounced 50 cents late in the day and a further dip is setting us up for a real nice move as long as we get some uncertainty in the markets. It could coincide with an overall market downturn. SVXY had another nice day and I’d think about taking profit soon on it.
One might have got a trade out of RUSL today, but yesterday I said these two are playing leap frog with each other and aren’t really attractive yet. I do note that today’s 7.12% move higher in RUSL is worthy of mentioning and if I was in it I would once again look to see if it breaks out. It could very well move to 23.91 from here. Just use a stop and you’ll maybe get a couple points out of it. RUSL is close to under 12 again and is always an attractive play under 12. Keep an eye on an overall market pullback here in the U.S. to possibly give you direction.
ETF Research Trading Package
Along with the Mining Package below, we will be rolling out an ETF Trading Service soon that we are very excited about. Our goal is to help you make good decisions with the research we provide. This will be replacing the ETF data I have been providing for free the last 7 months here in the Current Thoughts section. We are sorry to have to do this but the time involved deserves some consideration as to preparation and naturally compensation. You’ll be happy to know that anyone that purchases the Mining Package will get this information for free for 6, 9 or 12 months depending on which Mining Package option they choose.
The ETF list will be expanded from the ETFs below to 30 and possibly more with the goal of helping you make good decisions in your investing each day where we typically see a 10% move in an ETF about every other day. What is important about this list of course is my continued analysis of what I see occurring to help you in this cause.
Details for the ETF Research Trading Service and sign up form can be found by clicking the link below.
Gold and Silver Stock Mining Package – Release date will be either Thursday 3/26/2015 or Friday 3/27/2015 – If you are signed up, look forward to an email announcement with the details then. If you haven’t signed up, please 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. I still think that lower low will come but I want you to be well prepared before choosing which companies to invest in based on the research this report provides.
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 the miners 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. 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 9 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 like Allied Nevada just did on March 10, 2015. 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.
If you are interested in this Gold and Silver Stock Mining Package let us know by clicking this link below and completing the form. Thank you.
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
Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don’t trade with capital you can’t afford to lose. This is neither a solicitation nor an offer to Purchase/Sell futures or options. No representation is being made that any account will or is likely to achieve gains or losses similar to those discussed in this outlook. The past track record of any trading system or methodology is not necessarily indicative of future results.
All trades, patterns, charts, systems, etc. discussed in this outlook and the product materials are for illustrative purposes only and not to be construed as specific advisory recommendations. All ideas and material presented are entirely those of the author.