GDX is directly on top of the head and shoulders neckline ready to rupture? 38 is the target should the neckline at 52 fail. The gold miner bulls need to stop a breach of 52 at all costs, otherwise, the 38 will likely come in the weeks and months ahead. This information is for educational and entertainment purposes only. Do not invest based on anything you read here. Consult your financial advisor before making any investment decision.
Hello KS, is this a good time to short gold?
ReplyDeleteKS, thanks for your advice on TLT last time I asked you about it. It's been taking a beating the past couple sessions. Is the bull flag still in place (targeting 150) and has it reached positive divergence at this point? Thanks again for your invaluable insights.
ReplyDeleteSteve
Hello Mimimo, that is a question that only you can answer. The gold charts speak for themselves. Study the dollar since the dollar moving up should cause gold, silver, commodities, copper and equities to move lower. This asset relationship appeared to have changed the last few days but it was back in sync again.
ReplyDeleteHello Steve, isn't that something about TLT, Keystone says he is simply a blind squirrel that luckily found another nut. That was a nasty drop the last couple days. For any novice traders in the readership, TLT and TBT are ETF plays that traders use to play the Treasury Note/Bond market. When prices of bonds move up, yields move down and visa versa. If there is a lot of demand and/or short supply, prices go up, or visa versa.
Thus, the inflationists expect yields to climb strongly, they actually have been waiting for this to occur since late 2009 (quantitiative easing eventually causes an explosion in inflation, hyperinflation, it is simply a matter of when). But, who knows, perhaps this is a more sustainable move, however, Keystone remains in the disinflationary/deflationary camp still yet.
If you expect yields to go up, that means you expect prices to go down, so you want to play TBT which is ultrashort price. TLT is long price so those that lean towards deflation are more favorable to TLT since bond prices would be expected to rise, and yields fall.
Back to Steve's original question. As everyone knows, you are in charge of your own mouse, so you have to make your own decisions, but TBT weekly chart shows a long and strong profile and another high would be expected in the weeks or months ahead after a pull back would occur. Thus, TLT would be expected to make lower lows after a recovery bounce occurs. With a drop like the last two days, best to stay away from here and let the smoke clear. Keystone will probably post a TLT and/or TBT chart over the next day or so.
Thanks a bunch KS! Look forward to your analysis on TLT and TBT the next couple days. I think TLT is another way to short this market w/o the decay from leveraged ETFs like SPXU and TZA (my other holdings). Plus, you get a monthly (measly) dividend on top it. Take care now.
ReplyDeleteSteve