This morning I added a note to last nights Current Thoughts about what gold did overnight in Asia and Europe as well as at the open here in the U.S. Here is what I said around 6:30am PST.
10/22/2014 MORNING UPDATE
Gold never did follow through higher and the miners are all gapping down. CPI came in as expected but the dollar is up strongly with interest rates rising a bit. Gold needs some good news to get going. TNA gapped up to 65.29 and we might see a reversal coming through Halloween so I’d be careful. UGAZ still weak.
Tomorrow’s (Thursday’s) Unemployment Claims will be the next catalyst. Can’t see a real reason to be long anything right now.
I don’t do updates often but when I do it is because of a change I see occurring. I technically should have made this a separate update and will do so from now on so people know about them that check back to the site often.
TNA and UGAZ
TNA first off fell from the 65 where I told investors to be careful and fell over 3% to close at 62.08. UGAZ still remained weak and hit another 52 week low. Tomorrow’s report might be a catalyst for a bounce. Of course if the supply increases, we head lower. Risk vs. reward on this right now is aiken to gambling. Better to wait for the report and play UGAZ for the bounce if the supply numbers come in lower. Otherwise the play is DGAZ.
Gold Mining Stocks
Gold couldn’t get going today and the miners, GDX, JNUG and NUGT are fast approaching their 52 week lows. As many readers know, I expect gold to move lower (along with silver), so look out below. Can we get bounces from here again? Sure. But right now, with a stronger dollar, and no other real data to move it higher, gold looks weak. Tomorrow’s unemployment numbers might shed more light. Otherwise, it looks weak until the Fed meeting next week.
Silver and GDX scores moved back up to -100, after 1 day removed. Gold stayed at +60, but I expect that to fall soon depending on the Unemployment report.
JDST
One ETF that looks good though is JDST with a score of +100. If GDX and the other miners break to new lows, expect a very nice pop in JDST. I was conversing with a friend today who sold his mining stocks that he bought when Larry Edelson said to buy earlier this year. He finally decided to sell them and I had mentioned I was looking at JDST at the time. JDST was trading at 17.71 then. I told him I would be writing about it in today’s report. JDST ended up closing at 18.96, up 15.26% on the day. Keep an eye on it and if/when the miners break down, JDST may just break 28 and when it does, there will be a lot of those stuck in gold mining stocks feeling the pain. JDST was trading at 85 in January.
10-22-14 GLD Chart
10-22-14 SLV Chart
10-22-14 GDX Chart
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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.