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Today I cleared out positions in 4 stocks in my portfolio. Now I just have 6 stock positions and am approximately 70% in cash. Today was purely a housecleaning maneuver. If I could sell something for either a gain or just break even, I sold it. No True Strength Index (TSI) or Money Flow Index (MFI) indicator considerations involved with any decision to sell. I simply wanted to clear out as much as I could w/o taking a loss.
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The gold market is now at a precarious position, in my opinion. All due to the surprising strength and performance of the US Dollar over the past 3-4 sessions. When I wrote my article "Gold's 7 Parabolic C Waves - Projection $1,600", I did not fathom that after Ben announced a $600 BILLION effort to devalue the US Dollar, it would actually rally.
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Duh, the only logic that seems to ring true is that, once again, when everyone is thinking the same thing, no one is thinking (starting with myself). If the US Dollar does continue the powerful rally begun 4 days ago, and take out $78.36, that will strongly suggest that the US Dollar yearly cycle low came a few weeks earlier than expected. And generally, that may/should put pressure not only on the overextended stock market, but also the precious metals and their miners. This "fact" has not occurred yet. But it could, and soon.
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I offer these miscellaneous thoughts, of concern to me:
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1. The CME today raised the margin requirements for silver traders by 30%. This is a clear attempt by the government to cool the speculation in silver.
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2. The True Strength Index (TSI) indicator trend line was cracked on numerous key issues with yesterday's massive sell off. This means that any successful retest of the highs in everything from GLD, SIL, AGQ, GDXJ and so on, will create negative divergences across the board. Little old me, for one, will take that opportunity to short - probably using ZSL.
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3. Call me cynical, but following the massive distribution day of yesterday - where volume was astronomic and price could not rise (it dropped) - what better follow up for today and potentially the next couple days (Thursday and Friday) than to allow gold related securities price to be somewhat positive for most of the day - as smart money continues to sell to the dummies who are 'buying the dip'.
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Well, the US Dollar yearly cycle low is, as yet, unsubstantiated. Ditto for my cynical comments. But these were my trades for today, nevertheless:
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This is Timberline Resources Corp (TLR) which I sold at breakeven $1.18. TLR did close today's session at $1.23.
Click on any chart to ENLARGE
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This second sale was of Gold Reserve Inc (GRZ) at $1.55. This was a 4.0% gain for me and GRZ closed this session at $1.50.
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The third sale today was of Silver Dragon Resources (SDRG) at $0.23 for a modest 4.5% gain. SDRG closed today at $0.26.
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My final housekeeping clean-up sale was of Continental Minerals (KMKCF) at breakeven $2.54. KMKCF closed today's session at $2.54.
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My TSI Trading record has been updated and my cumulative record, begun a little less that 5 months ago is now at 495.6%.
Nov. 23 Weekend report
1 day ago
Hi Carlos -- I, of course, do not know what is going to happen. But should I see a huge negative divergence between price and the TSI, with MFI dropping off and the US Dollar making a higher high, yes I will probably short silver and go from there. I think you did understand my post. Thank you for writing.
ReplyDeleteJohn,
ReplyDeleteBut despite this USD rally coming early, your C wave projeciton still stands ..correct? I understand correction (even deep) but still C wave is not ended ..correct?
John, you are one smart guy. I've been reviewing your approach, which encompasses more than following tech indicators and holding on to convictions, and acknowledge that you operate as an astute trader. Looks like it took you many a beating or early exposure to how to do it right.
ReplyDeleteBest wishes,
Neil