IAC Thanks so much for your message. It sure helps that you present your investing parameters like you did, so that we are on the same page. I have invested in this sector for five years now and am well versed in the fundamentals behind the move in POG. It has been very profitable. One can certainly argue till he is blue in the face bullish fundamentals. Also that they remain and if it is not broke don't fix it. With larger portfolios that are diversified it would appear imprudent to sell positions in mining equities. Yet at the same time I seek to lock in cyclical gains and agree with you that the technicals still do not warrant such an action. But are my ears up, you bet.
At the same time however I also manage smaller more aggressive portfolios as well as a good deal of speculative money. It is these funds that are impacted by smaller trends, corrections etc..
What I have been seeing is good news for gold and oil quickly discounted. Also bad news for USD discounted. This is something I have learned to 'fear' as it usually portends a move counter to the fundamentals as determined by me.
For instance today oil is down $2 which is explained as Ernesto yet what about Iran news on weekend with reactor opening etc., also larger problems in Nigeria and upcoming union vote to withdraw all workers, also UN Security council meeting on Thursday and the list goes on. I have also noticed lately that the USD can decline and POG declines as well. Hmmm
So reading the tea leaves which are the charts, one tries to understand the reasoning behind it. A soft landing and inflation worries dissipate. or a weaker US economy with persistent inflation or will slowing economy cool demand for oil and what about USD, so many questions to ask but what do the charts and general market action tell us. This is where interpreation comes in..
So for me right now I am concerned in ST market and by implication longer term factors.
What do I think market is saying?
Worldwide reduction in liquidity is removing froth and cooling economy and inflation worries are declining, USD has retained safe haven attributes sufficient to support it even as economy slows. Commodities have peaked and will settle back towards the norm, oil will continue to fall, so lower oil and at least stable USD, hence POG at the very least stalled so easy $ made. Hot money is moving onto other sectors. This money has been liquidating while money managers who still follow the fundamental mantra add on dips and act as a slow brake on the decline. The trend may be reversing and as with anything it takes time to turn the bus around.
Re slider yes you are correct about his getting out to early but I also think it wrong to dismiss his arguments based on this fact alone. Cetainly in the past he has had an uncanny ability to smell such large turns before they arrive, especially when all fundamentals are seemingly stacked against him. One must not forget his refrain of 'got gold' long before this bull.
I think this coming week with so much data and events will set the tone for much of the fall and as the big boys and the volume returns next week the direction of the market will be very much clearer.
I have opted to go all cash in my ST $ and wait it out, trading this weeks news if possible but no more. Cetainly if sentiment changes due to geopolitical events etc., some very good short term gains seem possible with the carnage we are seeing today in such stocks as CDE HL BGO etc..
P.S. re NG incredible sage that continues, noted appeal from GATA to help NG fight the good fight agaisnt the evil empire (ABX). So does ABX raise its bid? Withdraw in disgrace? So is NG saying $30 a share? If so will ABX pay it? Sure looks like good time for a white night. Who would you guess? KGC sure comes to mind. But then all that copper adds a whole list of suitors who could sell what they do not want.
quite fascinating.
