NFTRH; Gold, Silver & the Miners (high priority)

An update to the update from this morning…

Let’s go through the charts again. From this morning:

Gold is flagging down (about $11/oz so far) and probably wants to fill the gap at least. More S/T support [is] at the consolidation shelf in the 1290s.

Status unchanged.


Silver got nicked a bit more and what silver bulls want to see here is the 15.30 to 15.40 area hold with a higher low to January. That is the next short-term support after the current area. Beyond that the next support is the very significant support at 14.70 to 14.80. I’d prefer to see silver hold 15.30 to keep the rally relatively comfortable.

From this morning’s update…

The Silver/Gold ratio, while still firmly in its major downtrend, has not broken down from the shorter-term uptrend (although its failure to make a higher high was/is a caution).

The status is the same after another down day.

Regarding the HUI/Gold ratio, from this morning’s update…

But here is the interesting piece of news. The HUI/Gold ratio has held firm so far in its attempt to take out the SMA 200. In other words, so far anyway it is having none of [the] precious metals pullback scenario.

Today and the rest of this week appears to be key in determining if this is going to be the same old, same old (i.e. the sector takes a hard hit after a hearty bounce) or something new and different.

HUI/Gold ratio actually popped to a new high but reversed to end the day. Personally, I did not like that reversal, minor though it was.

The miners are overbought after the gappy leg up and so with this reversal and down day after yesterday’s up day there is a fair chance of a pullback in play. The 50 & 200 day moving averages could be doable.

Bottom Line

Not much has changed from this morning’s update other than a reversal and lack of follow through.

With respect to the Post-September rally, nothing has changed. Actually what has changed is that HUI made an impulsive drive above the moving averages and that was bullish. Investors positioning for an extended bull run should, assuming the macro/sector fundamentals remain favorable, ignore updates like this other than for considering pullback buy levels or support levels that would be parameters to the ongoing rally.

As noted in the Trade Log I got back in late in the day, saw the charts and decided to partially (60-70%) hedge the miners with DUST in the short-term. In light of my decision not to do much profit taking, discretion is the better part of valor while evaluating further. In other words, I want to keep gains at least as much as I want to maximize them in the short-term.

I intend to be nimble w/ DUST, either in taking a profit on it if it turns out to have been needed as a hedge or in taking a loss on it if the rally resumes. I see the current moment as a way station between those two possibilities with the odds somewhat favoring a pullback of at least minor degree.

Meanwhile, as originally noted this morning we need to see how the week closes in order to have a bullish signal or going the other way, a short-term bearish one (for a pullback within the rally). It is not the intention of this update to shake longer-term players out of position. Indeed, that is why I am short-term hedging instead of taking profits.