I realize that at some point this could blow up in my face, but I am fully hedging* gold miner exposure again as I am in the midst of the best streak I’ve ever had in hedging the miners for profit and protection all at once. I have of course had some not so satisfying exercises in the past as well. But always when hedging, you realize you are taking insurance first and maybe seeking a profit second.
We assigned an upside target of 220 on HUI, it dutifully hit that and I hedged it (DUST). Then HUI dropped hard into the FOMC announcement, sentiment turned S/T over bearish and I covered profitably. Then the miners bounced to fill a gap and I re-shorted. Then they dropped to the pre-planned support area of HUI 195-200 and I covered profitably again.
And now here we are today, with the sector popping again as US Stocks Sink as North Korea Escalates War Talk. The miners are of course getting pumped and it seems an opportune time to try a hedge. I try not to make a habit of bragging because I know that the market will rip me a new one at any time it so desires. But the facts are the facts and today the fact is that the gold sector is going up and stocks are going down as political saber rattling is taking place. As noted in NFTRH 466, the now declining daily EMAs 10 & 20 are key to resuming the uptrend. The index did after all smash into and hold a valid support zone. So I’ll likely not have too much patience with the hedge if 205 is taken out with conviction.
The reason I am noting this publicly instead of just doing my thing privately after illustrating a game plan in NFTRH is that I’ve established a sort of theme here and I may as well see the process through. Please don’t expect that I would continue to micro manage publicly. That’s a fool’s game, anyway.
* Of course “fully hedging” is a theoretical term as I own a lot of different miners, some of which have been doing some really nice things lately (like out-performing the sector). Often, a theoretical full hedge of the ‘average’ gold stock still allows positive overall results.
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