A move below $400 makes sense, as there are probably quite a few stops there from the people who got long recently. That would shake out the weak longs who piled in on the break to multi-year highs. That said, nibbling from the long side makes sense if you view this as a correction in a bull market, and it is certainly better to be adding now than at $430 a week ago. I tend to be a bit greedy sometimes and hold out for better prices - sometimes I get them and it pays off, but other times I miss the bounce and have to get in considerably higher. A good example was when I held out for a move to around 100-110 in the HUI, and it bottomed around 112. By the time I got in I had missed almost 40% of the move. So I think there is a lot to be said for scaling into weakness instead of trying to catch the exact bottom. You take losses during the final part of the correction, but equally you are guaranteed to participate if the market puts in a low earlier than anticipated and then takes off. If you don't take the risk, you might miss out on the reward. I now prefer to add 1/3 a bit early on the way down, 1/3 when I see the longs throwing in the towel, and the final 1/3 when the market makes a successful retest of the low, and then moves to a pattern of higher highs and higher lows. That way you spread your risk. So I would be looking to nibble some time in the coming days, and then see what happens.
Last week CNBC featured a story on how to play the falling dollar. I'm waiting -- this type of move may take a while to work itself out before the uptrend resumes. Patience.
By the way, Natural Gas had a 10% decline today, in one day, and this looks like the worst weekly decline ever, in the history of the contract.
Be patient, this is not a technical selloff. Its institutional investors providing some of us with an opportunity to re-enter certain positions at prices I thought would be long gone.Most juniors are down 20-to 30%,even though gold is 25$ higher than the last time these stocks were at this level in the beginning of last October.This panic selling is a pretty good indicator that we have reached or are near a bottom.Might nibble tomorrow, have to see the morning numbers.
The fed by dropping the phrase "considerable" has indicated that the next move in rates is likely to be up. This in turn has to reduce inflationary expectations which would be bearish for gold. Gold dropped $16 after the fed announcement indicating that a rate hike cycle will be bearish for gold.
what juniors do you currently own or like? are any of them traded in the USA on NYSE , AMEX , NASDAQ? I do not have access to canadian equities and B.B. pink names
BGO,WHT,GSS,are 3 gold juniors that have consistent,solid production, good and improving balance sheets,excellent growth potential,and have been sold off to the tune of 29%,22% and 37%,respectively.All on AMEX and usually on the weekly 25 most active by share volume list.There are lots of others, but these 3 are the best value for your dollar and if the institutionals aren't selling tomorrow I'll probably add a little of each.CDE is another good story with above conditions and is the largest primary silver producer in the world.Was priced at 27$ back around 96 when silver was $7 an ounce.I would hold off on anything exploratory until the pessimism washes out.Taking everything into consderation,these would be my picks for tomorrow. Goodluck
bought some big cap miners at approx settlement prices and will sell some mini gold futures if needed to hedge usually this "pans out " for me for a small profit setharb