First off, I’d like to recommend you read Doug Noland’s most recent Credit Bubble Bulletin, Too Much Asset Inflation. In the opening segment Noland lays out the dynamics in play with the current sovereign debt bubble much better than I can. This is who he is and what he is all about, as he has chronicled dysfunctional asset bubbles since early last decade. In my opinion, there are none better at explaining the unhealthy things that are in play.
On another front, my NUGT position lasted about as long as it took me to grab a profit on it and now I find myself with a possible bear rebound target of 300 on the HUI and no positions. It sounded good in theory to trade the leveraged NUGT and DUST (which I will still plan to do), but the reality is that is not who I am (we learn all the time, eh?) and I do not like being without the favored royalties, miners and explorers as long as I feel a rally (or more) is possible. So with my apologies for the static, I am withdrawing from the cold hearted ‘trade only NUGT and DUST’ strategy. I will however, be just as cold and ruthless with positions in these favored names, as needed.
For reference, here is the
60 minute [edit: 2 hr] view of HUI. The important support parameter is 275. On a bigger picture, HUI is in a bear market as we know. A bottom may or may not be in. Keep in mind the ugly weekly chart in this week’s letter.
Other than that, nothing notable to report. As a human being, I quickly came to a realization about my trading make up and wanted to update that, as well as reference the excellent work of Doug Noland.