Friday morning I decided to double my stake in U.S. Gold Corporation (UXG) at $5.04. My reasoning is both technical and news driven. From a technical perspective, the stock has dropped significantly below the lower band of its bollinger band. Every time the stock has dropped significantly below the lower band it has gotten a short term bounce. From a news perspective, gold is one of the few things I want to own going into the weekend due to the volatile situation between Kurdish rebels and the Turks. I believe that the market hasn’t really noticed (with the possible exception of the oil market) the rhetoric and potential for conflict between the Kurds and Turks in the near term, and I want to own a bigger gold stake to hedge against a potential conflict.
With my recently increased stake, my basis is now down at $5.25 in UXG. I will likely be trading around this position.