Gold, silver and the miners all went up slightly today ending a mini losing streak. The scores for all 3 improved a little. The dollar stayed above 85 on the index while the 10 year maintained at 2.20%. Is this the beginning of a bullish breakout for the short term? It seems like the risk vs. reward might be there for it after a few days of uncertainty.
The DOW eked out a positive number number for the day and TNA ended up 3.45% and closed 2 points higher.
UGAZ, another ETF I have been following broke to a lower low again down 7.43% hitting a 52 week low at 11.22 before closing at 11.33. When UGAZ bounces, it will be a nice trade but it’s hard to catch the falling knife. Scaling into a position will eventually work but the timing on these have to be good. Who says we can’t keep falling if we break down in natural gas just like I expect the gold miners to break down once gold breaches its triple bottom?
While I will be concentrating on gold/silver and mining shares in my updates, I will sometimes point out what I see as possible opportunities with the caveat to check with your advisor first. Many of the leveraged trades should be for traders who have good experience trading, not for your average investor. I simply look for a risk vs. reward play and share my thoughts. Take profits when handed to you. No one goes broke taking profit and the main reason people lose on a trade is they get greedy, expecting more out of the trade and then don’t keep a stop. Always keep a stop on your trades.
I don’t view physical gold and silver as trades at all. I do think dollar cost averaging into a position right now makes sense. I do expect a lower low for the metals and mining stocks and have been telling clients for some time now that the best approach is to average into the metals for now.
Overall, gold is still in an uptrend with silver and the miners in a downtrend. I expect an uptrend to continue at this point, especially if the dollar falls below 85. Keep an eye on that as your indication on what to do for the short term.
10-20-14 GLD Chart
10-20-14 SLV Chart
10-20-14 GDX Chart
Disclosure:
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.
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About Doug EberhardtDoug 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
Disclosure:
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.