What a day for the DOW. I mentioned the last couple days that I was bullish on stock until Christmas. Today we saw a 421 point gain for the DOW after a 288 point rise yesterday. TNA gained another $3.26 a share to close at $78.08. $79 may represent some short term resistance but beyond that and we may just march on up to the 52 week high of $86.68.
Part of the reason I have been bullish on stocks despite that downturn we had was because typically going into a Holiday the stock market moves higher. This doesn’t mean its always the case, but I have tracked it for awhile and it has been a pattern I expect. I don’t care about manipulation of the stock market but the last thing anyone wants is for the stock market to fall and more fear to set in with a family Christmas conversation about how awful their stocks are doing.
Unfortunately those in Russia aren’t so lucky this Christmas. I have followed RUSL and after two days of being 50% down it rallied 129% off its low and now has fallen 26% from its high. It is something worth watching and possibly swinging long with and I say this for a couple reasons. One is that we have seen many stock markets crash and rebound. Russia is no different. Whether oil rebounds or not, Russia will rebound. But the second reason is a good one. Today Google has a market value more than all of Russia’s entire stock market. It turns out that Exxon, Mobil, Microsoft and Apple are also worth more than Russia’s stock market. Russia’s not a 3rd world country and yes, there are issues going on there with the price of oil falling which is 25% of their GDP and the situation in Ukraine as well as U.S. sanctions, but these won’t last. I would probably scale into a position.
Gold didn’t have a great day but the miners sure did and they turned green on the daily. The weekly though is still red and JDST daily turned red but weekly and monthly are still green. Gold and Silver maintained a price level below the $1200 and $16 mark but they are within a few cents of those levels. Look to see if gold can break out of this pattern tomorrow or if we finally do break down to possible January lows.
Natural Gas report came in negative once again but UGAZ gapped up opening at $9.23 and reaching a high of $9.47 before falling after the report. Market makers used the report as an opportunity to trap some longs by pulling the rug from under them. I wrote yesterday that I would be leaning towards DGAZ after the report came out and DGAZ went from about $4 to $4.50 for a nice trade.
USO was weak again and was 1 cent from its 52 week low. UCO came within 2 cents of its 52 week low. Falling knives everywhere in oil related investments.
Tomorrow is triple witching Friday which occurs 4 times a year. According to Investopedia it is sometimes referred to as “freaky Friday.” They explain triple witching here:
The final trading hour for that Friday is the hour known as triple witching. The markets are quite volatile in this final hour, as traders quickly offset their option/futures orders before the closing bell.
This is a trading day which is best suited for professionals where you may see some whipsaw action. If you trade it I would be quick with taking profit, and at the same time, quick with your stops if you are caught on the wrong side of the trade.
Was a quiet day of sales for gold and silver. Nothing for me to be real bullish about. With the stock market powering higher, buying gold and silver isn’t really on people’s mind. At least not yet. Of course many in Russia would have preferred to turn their rubles into gold about 3 months ago.
12-18-14 GLD CHART
12-18-14 SLV CHART
12-18-14 GDX CHART
12-18-14 GDXJ CHART
12-18-14 JNUG CHART
12-18-14 JDST CHART
12-18-14 NUGT CHART
12-18-14 DGAZ CHART
12-18-14 UGAZ CHART
12-18-14 TZA CHART
12-18-14 USO 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.