Talking Up The Dollar

Just when you thought it was safe to jump back in the pool the dollar bulls come alive and down goes gold in a major dump as the greenback squeeze and dollar bull calls coming from far and wide. I have to admit I was deked out some by golds bottoming action then up move and thought we had the possibility to at least hold the $1100 area but that looks to be a dicey proposition.

After a $120 dump on gold the spec longs are going to be very weakened and if there is any serious "intervention" to dump gold further then now is the time before it can gain some strength. There is alot of shorts who will take profits before year end which exasberates the problem. I am returning to my mid $1050 - $1075 call from a week back. It may still take several days to play out as once again gold is back up $9 overseas.

One important item is some of the juniors are holding in well and not getting totally wiped out as usual in a correction like today. That will bode well as major money can still be made mining at $1000 gold and $16 silver. Part of cause of this action was todays jobs numbers so called "disapointment" of 7000 more jobs lost. Are we talking McDonald's burger flippers here or what ?

On top of that Bernake claims no chance of interest rate hikes anytime soon yet more Fed related types are verbally warning they could go up sooner than expected. Yes we have heard that before too many times the past month with no effect but now it matters ? Unless it is a major move in one shot, a 25 basis point raise will have a short lived effect on the US dollar. There is too much paper out there and todays action is a sign of the "talking it up" effect by the FED to keep the dollar from tanking. Signs of desperation to me.

Trader Psychology

One of the hardest parts of trading or investing is keeping our emotions in check when buying and even moreso when selling. I can easily still find myself sitting on a winner knowing I should take profit then watch it fritter away back to ground zero where then that trader now reluctantly becomes a long term holder.

Nothing worse than new found enthusiasm being quickly eroded into complacency and false reasoning why it's a home run, only to possibly end up even losing on what was originally a winning trade. Happens to the best of us, that is why I am way more focused now on keeping the emotional side at bay and clicking that mouse when the time is right. ?

But how ? Practice, plain and simple. Make paper trades hundreds of times,even if you just keep a mental scorecard. Drilling home that mental AND verbal command to hit the sell button and then give yourself kudos for pulling it off. It is critical to changing the mindset that you are going to miss out on even more profit which most time you don't. Reward yourself right after with a treat,beer,Canucks tickets or whatever. Sounds like animal training doesn't it ? :)

Practicing is critical if you want to be an active/short term trader,theres no time to waste humming and hawwing. You have to almost take a piece of paper and tape it to your monitor that says " Why The Hell Am I Even Here ? To Take PROFIT !!! " You may find that helps, it does for me.

When we get into these kinds of markets where we are basically flatlining/range trading, it is a good idea to use a couple valuable sites to keep you mentally in the game but not destroy you with information overload. The site I go to in times like these is who I refer to as The Godfather of Trading Psychology, Dr. Brett Steenbarger. The guy is frigging incredible and it is all free. The man is a trading psych machine who provides tons of charts and insight you will find no where else. You will find him at http://traderfeed.blogspot.com . He's on Twitter as well.

The second site I like to go to is Bernie Schaeffer's site for his weekly commentary which never ceases to amaze me on how bang on this guy is with his market insight. When the herd is leaning one way, he will lean the other but back it up the other with facts and stats that are so easy to understand. He has helped me many times when I see uncharted waters ahead. He's at http://schaeffersresearch.com/ .


Hope you find those two sites helpful as education is the key to making money and I love to help others make some cash as well as have some fun at the same time.

Cheers !

Dear Santa...

Coming into the last full week before the markets shut down to a crawl, I have a request for Santa for one last favor for the year....now get your mind out of the gutter. One last push up would be reassuring to the masses that yes, Obama and the boys at Goldman are still running things and they could care less how high gold goes. Sounds like a reasonable request doesn't it ?

We have gold up a ten spot tonite, and the markets overseas flatlining as the US dollar takes a step back. Tomorrow will be interesting to see what happens to the dollar and if the latest rise really has legs. I won't rule out some more volatility but we are due for a bounce here, my indicators show a short term bottom. C'mon Santa, just one more kick at the can.

Uptrend Intact

Came across this excellent gold chart that shows us that as long as we stay above the 50 Day Moving Average at $1099, we will be in fine shape. The Fast Stochastics is looking good and has formed a nice bottom.

I never used TA charts as much til after last years melt down. I am now of the mindset that more money can be made by playing the overbought and oversold TA peaks and valleys than to try and time the moves on basic fundementals alone. Note: I am referring to blue chip stocks with a healthy and steady volumes that gives the chart a true read.

Thinly traded juniors (like what I talk about mainly on here) are a different beast entirely ,and company news events/financings etc is what influences their cycles. Charts are reliable on them when there are breakouts after long periods of dead action.

When I look at the S&P 500 SPY chart I see a choppy range trade that looks very scary yet could burst higher in the new year but that will depend on company earnings. When I look at the gold chart above I can see a decicive line in the sand that helps me make crucial decisions that may ulitmately effect my junior picks as well as any blue chips or options trading.


You can't discount these crucial lines in the sand as all the hedge funds and institutions almost solely rely on them these days more than any other time I can recall. Propriarty trading firms amd black box institutions trading desks live or die by TA charts. It is a must to learn the basic skills and not rely on the latest stock picking site that seem to be popping up on Twitter and Facebook like a bad disease.

My concern with the gold chart is if that $1099 level is busted,what does it say about the state of the DOW and other world markets ? Will the US dollar shoot back like a rocket if this number is broken ? I would bet it would as the flood of dollar shorts covering will be frigging massive. Now is the time to watch the charts closer than ever but I don't expect the risk factor to rise til after Christmas.

On the bright side, the GLD chart I posted last night is showing very close to a bottom so if gold bounces nicely off this critical level, then the precious metals and the metals stocks may be ready to both launch into the next power upwave and take out the old $1220's high and that indeed would be sweet !

Short Term Bottom ?

Today's whipsaw action in gold was most interesting. On one hand it was looking like maybe we had hit a short term bottom with gold up $17 plus at one point. One click later at mid morning and gold was back to even, then down $15. That was quite the drop, a $32 swing, and I have never really found out what was the exact reason but the US dollar did not seem to move any serious amount to effect this.

On the other hand the XAU index was up all day and the metals stocks showed some good strength. This is an important signal if we are to be in a short term bottoming process. As per the chart above for the GLD ETF, the signals are nearing bottom in the next few days. I like to use the 3 month Stockscores chart as it has been very reliable in most cases, especially when looking for overbought and oversold conditions.

With Christmas on the horizon and a slowing market, we'll be bound to have some more profit taking and weaker bids so I won't rule out a couple of more shots to the downside here. Remember that the metals stocks and the metal itself don't always move in tandem but movement in the stocks first after a pullback is a very positive event but it is just one day so don't go all in at first spike.

It Was 29 Years Ago Today...

Hard to imagine that today is 29 years since John Lennon was mercilessly gunned down and not a year goes by where one wonders what magic we were denied. The possibilities are endless when you let your mind wander. You can bet he would have continued to be an outspoken person against war and many other injustices in the world as well as creating more timeless music. Always a moment that I remember where I was when the news broke. Not many people other than one's immediate family have that kind of power to most of my generation these days.


On to the markets. The gold correction continued in spades today closing down another $28 breaking thru the $1135 first support area. There is no doubt the shine is off the metals bull but I did notice some of the popular junior stocks are holding up fairly well with some closing up today albeit in the few perentage points and that could change if gold keeps getting pounded.

The GLD chart tells me we have a few more days to go still before it bottoms out and builds for another run. With Christmas coming I doubt we will get much of a rally off the bottom with the market thinning out on the risk taking long specs.


The fundementals and the technicals need to come back into alignment as this was just too much too fast. In the meantime, sit back, play some Lennon tunes,chill out, and stay warm, this precious metals bull has a very long way to run and lots of money to be made.

Gold Bear Coffee Break ?

My prediction of a nasty follow through started out looking bang on til someone named Bernake opened his mouth and as usual things started going the other way. With gold down $24 bucks, our market savior teased us with more comments on no interest rate hikes anytime soon, and an improving economy is upon us. It's these kinds of events one cannot predict and gold responded by rallying to down only a $1 before closing down in the $5 range.

Is this it for the gold/silver correction ? I am not convinced yet, though gold is up over $7 tonite. We still had one big nasty sell signal on Friday with record volume on the GLD and today being another down day. So before the charts can give us a new buy signal we will have to see a nice $20 plus gain to bring back the spec players who will be very cautious after Friday's power dump.

I hope to bring some new trade ideas to the blog soon in the blue chips as we move into a possible Santa rally next week. If this fails to materialize, I will be adding some of these ideas into the new year for sure, as well as my current penny plays and some daily top trader as a possibility too. Be cautious out there !

Golden Bear is Lurking

Friday's crushing of gold and silver answered the proverbial question of "when will this bull run cool off ? ". Well it's here in my opinion but is a much needed pause to allow things to settle down while the dollar shorts cover their winnings then wait to reload for the next step down.

As we speak the markets are open overseas and gold is down $9 which tells me tomorrow is day 2 of a possible 3-4 day nasty correction. Considering the record levels of shorts I will bet that somewhere in the range of mid to upper $1050 range could be the true bottom. It's always quicker on the down side than the up and what we have witnessed the past couple of weeks is not usual behavior and the long specs are going to get killed as they always do buying at the top.

So in other words "everyone out of the pool". I am bullish long term for gold and silver but the higher we go, the more volataile the swings will be so we best get used to it and watch those stocks that are able to withstand the selling.

I would much rather be a bear in the woods than a "tiger" these days anyhow. ;)

Tax Loss Presents

As much as the markets are flying high, not all stocks are following suit due to various reasons in their development cycle. Thus they can be victim of the notorius tax loss selling season and provide some true gifts to the nimble investor.

Those who are impatient sell and take the loss/gain or just need the bucks to pay for Christmas. They're also selling with the intention/hope to buy them back after the 30 day selling rule for the same price or less. I look for stocks that won't be on sale long and the New Year will bring news flow to their sectors, primarily the precious metals sector and the junior tech/biotechs that meet my criteria.

Below is a list of stocks that "may" be in a position in the next 30 days to pick up on sale and make a nice present for one's portfolio.

Note: I may or may not own shares of these companies and may trade in and out so please don't take my list as investment advice and do your own DD as I am not responsible for any of your decisions, they are yours alone.



#1 AHC - Artha Resources, naturally my number one favorite precious metals stock. Not sure how much cheaper it will be getting in here as today there was some true gifts in the 16 range. I see stocks with less trading for 2-3 times right now so this is a steal where it is.


#2 EMG - EmerGeo Solutions has already been on sale the last few months but I expect better things in the New Year. Yesterday their financials came out with a 100% revenue increase to over $1 million for the quarter and margins rising to 36%. A specialty emergency disaster software company with explosive potential for 2010, it's been a long time coming.


#3 CA - accumulating land in Colombia near VEN but a bit expensive for where it is in it's exploration cycle. I would be buying in the low 30's,can trade a little thin so use the stink bid.


#4 TNG - software gaming deal with Intel, say no more. Anything back in the 70's would be a deal.


#5 PRX - a prostate drug for those dudes with BPH. I am hearing good things on this one and looks like it could be big if the next results prove up. Bio's are always highly risky but they seem to on the right path. Anything back to the upper 50's to low 60's would be a good spot to focus on.



Don't forget to use the major markets as your guide before diving in,they can be a bigger cause of selling than just for tax loss reasons.

Happy shopping !

Dubai Dust Storm

As we all well know now,there's some trouble in paradise but how deep this goes still has some ways to play out. Some of the media reports have varied but overall calm hit the markets today as it appears some of the scariest debt will be taken care of. The question remains how many other Dubai's are lurking out there and has the US taken care of the worst of theirs ?

As far the internet goes, the stories can appear to be valid, only to discover they are written by some anti-elitist types telling tales of intimate connections to the highest powers of the US government and certain currency events that are close to happening, but we see these stories nowhere else on the net,hmmmm.

Best to keep a level head, realize we are in an overbought,range trading market that is searching for some levelling off zone. This will hopefully remain through Christmas along with the precious metals finding a new base level in here without any nasty corrections so many are calling for. Aren't these the same people who called the top the last six months ?

The precious metals prices are here to stay in my opinion. Canaccord just upped their peak gold and silver prices to $1300 and $21 respectively. Those are very nice numbers to work with going into next year. Got Artha ?

More AHC News !

The news machine keeps rolling for Artha as they came out with some very excellent results on their ground exploration program. Hopefully I can help discect it for you into some laymans lingo over the next few posts.

Each of the zones sampled have their own exciting results and is why I was attracted so much to Artha when they first got the option rights. In a nutshell they are finding the indicator minerals that you need to find when hunting for a mineral deposit in the hottest stretch of land in South America.


Key statements:

Phase 1 reconnaissance mapping and sampling program have confirmed the potential for discovery of precious and base metal mineralisation

Noelia Breccia prospect adjoining Pirquitas shows geochemical and geological signatures suggestive of the upper levels of a Au-Ag low sulphidation epithermal system

A broad, 6km by 2km contact zone on the Vallecito property (40km east of Pirquitas) between sediments and dacitic intrusives suggest potential for skarn replacement mineralisation


Results from this first phase work have clearly demonstrated that a number of high priority targets exist with geological, geochemical and structural indications consistent with both low sulphidation Au-Ag epithermal systems and large skarn deposits similar to the Aguilar mine approximately 100km south of Artha's properties


On the Vallecito Property:

The evidence suggests that this might be an IOCG type deposit but also has potential for an iron skarn deposit linked to contact metasomatism.



I will get more into this news over the coming days but this is an important news release for Artha and clearly shows they have multiple hot targets that will keep them busy, and us excited for a long time here. I have stated this before but I haven't been this pumped about a grassroots exploration company in a long time. The potential is clearly showing through now.


Here's the link to the news:


http://www.artharesources.com/s/NewsReleases.asp?ReportID=374006&_Type=News-Releases&_Title=Artha-Announces-Pirquitas-Properties-Update

$1200 Gold In Sight

"There's something happening here
What it is ain't exactly clear "
- Stephn Stills, Buffalo Springfield



Once again the gold and silver market chugs higher in leaps and bounds while the US dollar broke through a crucial technical support line at 75 cents. Where this goes from here is anyone's guess but I sense from the power of the buying it may be a swift move to the $1200 - $1250 range.


There is too much negative news out there from Geitner secretly wanting the dollar to go lower and make the US more competive or the Russians today buying up more Canadian dollars. News like this is not everyday stuff. What's exactly happening here beyond a currency crisis is the mystery that has long been read of but we are now witnessing.



On the flip side there are many top callers out there who if right,we will be seeing a very swift move down as this rise has been extremely fast. The charts are screaming "overbought" but this current move may make a few chartists looking foolish as the bull stomps higher busting every short to pieces as they are forced to cover ASAP.


Personally what I think is happening here is a mass short squeeze that the media seems to not want to mention and are playing the US dollar side of things. It may well be a combo but remember it was only a couple of weeks back the COT report showed a record amount of shorts. Were they all sucked in for the gold bear slaughter ? me thinks so.

But how long this lasts til the market takes a breather for awhile is my next big question. This bull move is like none other we have ever seen and has some serious legs behind it. We all know one never wants to stand infront of a runaway train.

1980 Time Warp

Let me take you back...way back. All the way to 1980 when all sorts of crazy stuff was happening. The US Olympic hockey team upset those hated Russians, The Rolling Stones released "Emotional Rescue", The Police and Sugar Ray Leonard were all the rage, while inflation reared it's ugly head like never before.


Along the way gold prices had spent the previous year in the $400 range and spiked to above $850 by mid January only to be taken down in tremendous fashion to the $500 range by mid March. For those who bought junior explorers in the previous 5 years, they were rewarded in spades. Back then the media did not track/publicize the junior stocks like now let alone noticed by a young buck like me who though was aware of the price of gold.

We never had easy access to any of the stocks we can today, or the advice of wise men who had been there,done that. To even invest with a broker was a major deal and alot of hassle plus you had to have some serious bucks before you got any decent advice. It was like a closed shop for the young and inexperienced....my how times have changed.

For your entertainment,here is a sample I found showing just what happens in a true gold/silver mania. Obviously something comparable to the tech mania in the early 90's if you ask me. Can't happen you say ? But what if it does ? and what type of company would you want to invest in ? You know my answer.




Name 1975 Price 1980 Price

Lion Mines $0.07 / $380

Bankeno $1.25 / $430

Wharf Resources $0.40 / $560

Steep Rock $0.93 / $440

Mineral Resources $0.60 / $415

Azure Resources $0.05 / $109

Sunday Night Gold

Just a comment on gold action tonite. Though the COMEX has been open only a few hours, gold is up $10 already which is very unusual for this time of night. I think all the talk of gold being overbought is from those that don't understand the fundementals of gold and the US dollar.

The US dollar is on the ropes and unless some sort of interest rate/intervention by the FED,there is nothing stopping the precious metals. Silver is also up tonite an identical .8%. Nothing big in terms of percentage but very big in terms of timing of this. I think tomorrow could be a big day for the precious metals, something is up with the world currencies and the shakeout of the dollar will continue.

One more note, if you have ever looked back when gold went to $800 back in 1979 you may be too young to remember that there were many penny precious metals stocks that went from a dime or less to $300-400 per share on a half decent hit on results. That's no bull. I was just a teen at the time and it was incredible to hear of massive fortunes being made. I have one family member who made $2 million on just a couple of good ones, getting in early like with AHC. $2 million back then was like $10 million now.

I will find that list for you as not many will even fathom what can happen in a true metals mania. AHC is one I believe will be one to seriously consider when looking for the undiscovered gem witht that type of potential. These guys have found mines before and they will again. Always invest in those that know how to walk the walk, not talk the talk.

AHC News - Part 2

One other area that must be noted from the news release is the Pirquitas South Prospect for the shear fact alone that it contains the same geology as the Pirquitas mine. As stated in the news :

The Pirquitas South Prospect is a stockwork system in the same Ordovician sediments that host the Pirquitas Mine. The stockwork sits within the intersection of a NW and NE structural system and contains a hydrothermally altered zone with moderate to strong argillic alteration and veinlets of quartz and iron oxides. The size of the main alteration halo is approximately 1.6km x 1.4 km with two smaller halos mapped to the south and south west.


That is a second target zone with a phenomenal size of prospective land both within 2.5 and 5 KM respectively from the center of Silver Standard's mine. I'm not sure of any other junior trading at 20 cents that is this close to such a major deposit with this many prime drill targets and experienced management capable of hitting paydirt.

From the company's PR they also state they will be carrying out some areo magnetic testing in the new year which will help zero in on more precise drill targets. I also expect to see some sort of ground sampling results in the coming weeks. Optomism is abundant here as they also state they expect to find more exploration targets in the coming months next to one of the worlds largest open pit mines.

If you have missed my previous post, you should do yourself a favor and check out Silver Standard's website and view the video with the 3-D look at the Pirquitas mine to really grasp the enormity and how close Artha is to this beast.


http://www.silverstandard.com/projects/pirquitas-mine.htm

AHC News - Multiple Drill Targets

Artha Resources came out today with some solid insight into the key property areas they plan to drill target. The map above shows us the magnitude of the major land holdings all around Silver Standard's Pirquitas mine and multiple targets. So what's our odds of them hitting anything decent ? No one really knows til the drill bit speaks, this is the true nature of playing the grassroots stocks.


But when you break down the areas and define some of the geological terms, several provide some clear evidence that our odds increase,especially when the words " along strike " from the Pirquitas mine appear. Not only that, it is the size of the area. The Noellia Breccia is 1.7 X .8 KM in dimension,that is one nice sized chunk of land ! If we get some decent sniffs on the ground sampling then AHC will attract mucho market attention.

As the PR states:

Follow-up field work lead to the identification of a large tectonic breccia with dimensions of 1.5km x 0.6km. The breccia is hydrothermally altered and is aligned along a NW structural system with NE cross-cutting secondary structures, consistent with the major regional structures which host many of the known deposits in the area.


Considering the dozen or so historical mines since the 30's that dot the area around Pirquitas it would make sense that Noellia has decent potential to host something of value. As noted in the PR, a Priority #1 indeed !


If the map pic does not work, please use this link and see the press release below and there is a map at the bottom that can be blown up.

Over the coming days I will disesct the other drill targets but this is enough to digest for one day.

One more note. As much as the share price action has lagged on this news, I think it is just a matter of time til the Artha story becomes more well known. For those that have followed me over time, you will know I have been very keen on AHC for awhile now and is the most exciting exploration stock I have been invested in for a very long time.

Got Artha ? Stay tuned !


Artha News : www.artharesources.com

Precious Metals Rock'n Roll Train

So much for the range trade idea,this precious metals train is leaving the station here with the continued demise of the US dollar. Gold and silver exploded upward again today peaking at all time highs of $1140 gold and and $18.49 silver. To put it a in better perspective, gold was up 1.2 % while silver rocketed over 5.7% ! Silver is a smaller and tighter market with a much larger short position than gold and has been lagging gold for awhile now. I smell some fireworks.


You can now see why I like Artha Resources so much for it's silver potential. Not to downplay their gold potential though. They have updated their website and there are two noticable mentions. One is for large tonnage,low grade gold potential on their Davcha 2 & 3 proprties and a mention of potential copper vein system/deposit on the main Davcha 1 property seperate from the silver/tin/zinc.


This has expanded the company's options huge here,not to mention the Wyoming uranium properties they are holding. Multi dimnensional company or what ? When hunting for a junior explorer AHC has it all in my books,not a single red flag in sight.


Where does the precious metals market go from here ? No one ever knows, but as one metals trader stated today : "This is not a market to stand in front of." Enuff said.

Range Trade

Another positive week behind us after Monday's pop set the tone. What has followed that pop is the setting up of a familiar pattern known as the "range trade". Look at any of the charts on the Dow or gold and you will see that rise off a bottom with a rounding top pattern followed by a levelling off for a week or so,then a dip as the market finds it's bearings.

The last few months have been repetitive so don't be surprised to see a mild dip this week or next as the market lets off a bit more steam. This is healthy and will allow the markets to move higher the more we see continuing signs that the worst is behind us and new numbers show the recovery is in process. How long that process will be is anyone's guess but as long as the governments are still in there til middle/late next year I expect the volatility to remain pretty calm.

Not to mention the gold/silver bull market that is tracking the Dow etc to a tee. The US is trying to talk up the dollar while in China but barring some major switch in policy/interest rates it isn't going to happen. So party on metals bulls, the time is nearing for the juniors to ramp up, it's inevitable with the majors declining production as Barrick is not shy talking about.

One For the Boys

In Flanders Fields By: Lieutenant Colonel John McCrae, MD (1872-1918) Canadian Army


In Flanders Fields the poppies blow
Between the crosses row on row,
That mark our place; and in the sky
The larks, still bravely singing,
fly Scarce heard amid the guns below.

We are the Dead. Short days ago
We lived, felt dawn, saw sunset glow,
Loved and were loved,
and now we lie In Flanders fields.

Take up our quarrel with the foe:
To you from failing hands we throw
The torch; be yours to hold it high.
If ye break faith with us who die We shall not sleep,
though poppies grow In Flanders fields.

Starving Bear

By the looks of this pic,the bears will be waiting awhile yet to load up like last winters feast. The Dow,Naz, and TSX are looking strong with the past weeks rally and TA indicators show we have some room to run still but we are hitting a resistance line on the SPY at 110. Who wins out should be known by weeks end but I am betting on a continuance higher regardless of the low growth signals being given out by the economists.

The market and economists are two different beasts, and with the US dollar on the ropes I don't see much to make it move higher therefore the market bulls feed off this, especially after the IMF's announcement that the US dollar is overvalued. Can you say long term carry trade and higher gold and silver prices ?

At the same time the easy money has been made and it's become a stock pickers market,so buy them low when no one knows is my motto.

The markets are taking a breather this morning but that is to be expected with the huge gains of late. If we range trade here down a hundred points or two I would not be too worried.

Sorry for the lag in posts the past few days, the flu bug has bit me bigtime but like Ali in his prime, I am bouncing back off the ropes and slowly on the mend. And no, I do not have any sudden urge to roll around in a pile of mud.... I'm oink free. : )