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Doug Eberhardt
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Doug Eberhardt is the author of "Buy Gold and Silver Safely" and a broker/dealer selling gold and silver coins and bars at 1% over wholesale cost.
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  • Gold And Silver Current Thoughts 3-15-2015

    Gold is now down 4.9% in its last 9 trading days as the dollar has hit a 12 year high against the euro. I like the charts for gold and silver that Michael Noonan has provided as to where we are for gold and silver. A short term rally may be in the works, but it should be noted that this is a rally in the midst of a bear market.

    (click to enlarge)

    Silver has also had it's troubles of late falling to the $15 range again. The following chart also from The Market Oracle shows what trouble silver is in (despite the fact we may get a short term bounce here).

    (click to enlarge)

    If we do get a rally in the metals, look for a pop in GDX, GDXJ, JNUG, and NUGT this week. While JDST still has the daily and weekly green arrows pointing up, during the week of a Fed meeting, you can throw out the window any charts. Simply play the higher high and possibly be flat going into the day of the announcement. My guess is you'll get to play both sides for profit.

    Gold is up $3.20 in Asia trading and silver up 8 cents.

    What will the Fed do? I don't think they will do any raising of rates this meeting. As far as a change in the language, they may try and do what Draghi does so well and "talk the talk" of what they may do at some point; raise rates. What Steve Liesman will be spouting on CNBC will be how the Fed changed the language on how long they will wait to raise interest rates. The way I read the data tells me it will be awhile, but as I wrote before the last meeting, they may indeed raise rates to maintain the illusion they have control and keep some sort of credibility intact. They're not stupid. They know perception of them means everything. If we didn't have faith in those pieces of paper called "dollars" or "Federal Reserve Notes" then their game would be over right? Just look at the Ruble as to what occurs when people lose faith. Right now for the dollar, it's the complete opposite. Everyone, including me, looks at the dollar as the safe haven. But don't forget, gold is going up in price in all currencies but two; the U.S. dollar and the Swiss Franc of late.

    (click to enlarge)

    DWTI has been on a tear lately, moving up a tradable 6 points a day the last three trading sessions. Friday could have been a 10 point trade if you got out at the top, but of course not many can trade that way, so a good 6 points in the morning would have been a good time to take profits and go home happy.

    I will remind those who don't agree; this is deflation. I will finally write my article analyzing the data this week. It is so much data I can't even put it on one page, but link it to a separate page. I have been accumulating this data for over a month and of course busy working on the mining package.

    RUSS hit a higher high at 14.67 and could have been rode up to 15.76 at the high, closing at 15.59. We got stopped out of this at 14 and re-entered for a nice scalp on Thursday. If you are still long I would raise stop to break-even. If you want to guarantee profit, raise the stop to 15.00.

    DGAZ and UGAZ were difficult to trade and again in no mans land.

    UVXY could have been bought at a break of 17.79 and rode up to as much as 18.85 in the morning. It went on to touch 19.17 but fell from there to close at 18.23. If the stock market is up on Monday, look to trade SVXY on a higher high. I still lean long the stock market but right now the futures are pointing down. My data that I will show in my next article is all pretty much negative, but the stock market has a mind of its own. It doesn't matter where I lean, just follow the price action and trade it. I don't have as much conviction in my leaning long, I will say this. But I view this week as a difficult one to decipher as we have the Fed meeting that will cause some swings in both way. Will the Fed raise rates and put a damper on the market? I don't think so. Will the market then move higher? I think so. But it is the change in the language that will dictate, so don't get caught up in the first move until Steve Liesman tells you what the change in the language says. Then I would read it yourself before trading unless you see a breakout one way or the other. I have said many times that trading the week of Fed meetings is for professionals. The better way to play it if you aren't as experienced is to wait for the trend to reveal itself and play it.

    TNA fell about 1% on Friday to close at 85.49. It fell all the way to 82.59 and recovered the rest of the day. I will say that if for any reason we fall below 80 on TNA, while it may be just a short time, it shouldn't be ignored. Calling a reversal for a market isn 't easy, but the charts still tell me to be bullish and buy the dips. Let the Fed show the way. They love a strong market and if you knew anything about how pensions (defined benefit plans for government workers and large corporations) work in America, they NEED a strong market.

    Gold and Silver Stock Mining Package - Release date shooting for Friday 3/20/2015 - If you are signed up, look forward to an email announcement this week. If yo haven't signed up, read below.

    The mining package that we will be offering has been waiting for a release at a time that I feel would coincide with my overall view of gold and silver prices reaching the lower targets I think they can fall too. Many so called experts last year in July thought the miners would take off and next thing you know they broke to lower lows. Some called this latest run up the final fall for the miners. It obviously hasn't been and I know that's frustrating for many who are long or have been long for some time. There is a reason why I have been patient with the release of the mining package. There is also a reason why I chose the stocks I did and I'm excited about their potential. The mining package release date will be announced soon. I sent out an email to all who have subscribed recently with an update. If you haven't signed up, read the following and express your interest.

    For those who haven't signed up; We will be coming out with a mining package where we pick what we believe to be the best mining stocks to buy based on my research the last 8 months. We have been patient in releasing this because of the timing in purchasing these mining stocks can be tricky. We were one of the only one's who recommended selling mining stocks in September of 2010 when the HUI was trading at 512.56. Much has transpired in the mining industry since that call with many companies disappearing or being taken over. Today many companies are struggling and if we do get a further pullback in the price of gold and silver, more companies will go bankrupt. Knowing which companies have the best opportunity moving forward will be key to you getting returns that we believe will be in the 100% to 500% range, and possibly much higher for some of the miners. This package will be released in the next few weeks and we will announce it on the site.

    If you are interested in this Gold and Silver Stock Mining Package let us know by clicking this link below and completing the form.

    Gold and Silver Stock Mining Package

    Mar 15 7:56 PM | Link | 8 Comments
  • Current Thoughts 1-27-2015 Midday Report - JNUG And JDST Trades

    When I write my Current Thoughts I mention the words "higher high" in trading the various ETFs. In explaining this pull up a chart of JNUG which you can find here: http://finance.yahoo.com/q?s=JNUG

    Click on the 1 day chart for reference (as shown below).

    The following analysis is based on price action only. No Elliott Wave analysis. No fibonacci, RSI, etc. gobblygook. One can successfully trade these triple leveraged ETFs based on price action and some simple rules.

    (click to enlarge)

    The higher high came twice on JNUG, once at $39 and again at 9:47am EST or again at 10:33am EST at $39.80. Both could have been good short term trades where one could have locked in profit.

    Technically you had one more higher high but it occurred during lunch time which is never a great time to trade.

    If you look at the 3 month chart on JNUG we had 3 higher lows which is bullish. If indeed we are bullish (and gold would have to confirm) then JNUG could go to 45.55. A break of 46 and it's off to the races to possibly 56.

    (click to enlarge)

    On the flip side I wouldn't even touch JDST today till a break of 7.66. See chart here: http://finance.yahoo.com/q?s=jdst&ql=1 A break of 8.07 and it would be a nice trade to 8.50 possibly 9.00. A break over 9.55 and 13.92 might be next stop.

    (click to enlarge)

    Some of these would be swing trades, obviously. But look for the trend and only trade a reversal if gold agrees (and keep in mind yesterday was an enigma and not the norm where we saw gold down and the mining ETFs up nicely).

    What many don't realize is these two ETFs are not opposites of each other and should not be held for too long. JNUG is down 83.79% the last year and JDST is down 74.26%. Why would anyone in their right mind put money into these? The answer is, if you are on the right side of the trade, you can earn 10% in one day. But if you guess wrong, you can lose 10% or more in one day. That's why you keep stops!

    JNUG is up 9.88% today and JDST down 10.14%. UGAZ up 6.28% and UWTI 5.84%, two that I mentioned I like yesterday.

    Dollar was down big earlier today with market. Fear trade was on I think and gold benefited. But the stock market is coming back down less than 200 points at present.

    From this point of time in trading today I would look at the above prices for the right trade based on the trend and with an eye on gold prices as well as the potential for reversals. If a trade goes to a higher high and then reverses below where you got in, a stop should be in place so as to not let the trade turn into big losses. On the flip side, move your stops up on a profitable trade and don't marry these ETFs for too long. TAKE PROFIT! Another trade is just around the corner.

     

    Gold and Silver Stock Mining Package

    We will be coming out with a mining package where we pick what we believe to be the best mining stocks to buy based on my research the last 8 months. We have been patient in releasing this because of the timing in purchasing these mining stocks can be tricky. We were one of the only one's who recommended selling mining stocks in September of 2010 when the HUI was trading at 512.56. Much has transpired in the mining industry since that call with many companies disappearing or being taken over. Today many companies are struggling and if we do get a further pullback in the price of gold and silver, more companies will go bankrupt. Knowing which companies have the best opportunity moving forward will be key to you getting returns that we believe will be in the 100% to 500% range, and possibly much higher for some of the miners. This package will be released in the next few weeks and we will announce it on the site.

    If you are interested in this Gold and Silver Stock Mining Package let us know by clicking this link below and completing the form.

    Gold and Silver Stock Mining Package

    Jan 27 3:00 PM | Link | 11 Comments
  • Gold And Silver Current Thoughts 1-25-2015

    I have decided to write my Current Thoughts once a week as an Instablog every Sunday and post it here on Seeking Alpha.

    In Thursday's Current Thoughts I said I lean towards JDST and it turned out to be the start of the day up 14.94% as gold took a hit. The daily red arrow for GLD and the mining ETFs was triggered but SLV is still green.

    The Greek vote came in with the anti-austerity Syriza party winning the election but falling short of the percentage needed for an outright majority.

    Tsipras, 40, will lead the first eurozone government to openly oppose bailout conditions imposed by the European Union and International Monetary Fund, seemingly setting Athens on a collision course with Brussels and particularly Berlin. The result had "made the Troika [the EU, IMF and European Central Bank] history," he said.

    In Asia gold has opened up a few dollars and silver up 10 cents.

    Will be an interesting couple days on Wall Street as a big snow storm could keep many traders working from home. I expect to see light volume all the way around with no real U.S. data to trade coming out until Tuesday when we get Durable Goods, Services PMI, New Home Sales and Consumer Confidence. Then on Wednesday we have another Fed meeting and statement. Will this be the time they finally raise interest rates?

    Personally I think the Fed will raise rates here at some point, possibly not this meeting but the next one as long as the stock market is doing well and the 10 year treasury rate is under 2%. It's yielding 1.76% now and has fallen for 4 straight weeks. Doug Short has a great chart that shows how the Fed has kept rates artificially low since the financial crisis ended and the various Fed interventions in their attempts to stimulate the economy. The problem is, if the economy is doing so well, why are they keeping rates so low? Could the answer be that the economy isn't really doing as well as people outside of the cheerleaders at CNBC think it is? I will be analyzing this more closely in my next article I will be putting up on the site this week.

    (click to enlarge)

    I also wrote in Thursday's report " I have lots of questions on being so bullish with some unknowns over the weekend, so I would probably take profit for now and sit the weekend out. This is especially true if we gap up tomorrow." If you sold TNA in the morning, you locked in some profit. TNA closed down a bit on the day where the DOW lost 141 points.

    It will be interesting now to see how the ECB deals with Greece. For now, the Nikkei stock market has opened down and U.S. futures indicate a nice drop for the open. I will need to see how Monday trades before I get too bullish and advise to buy the dip. Too many unknowns right now.

    UGAZ got a daily green after having a nice day on Friday finishing up 8.04%. We may get a continuation of this trend with the blizzard hitting the Northeast but the left half of the nation has had some nice warm weather so I wouldn't marry the position.

    UWTI hit lower lows again as the death of the Saudi King and evidently listened to Prince Alwaleed Bin Talal comments that "oil will never see $100 again." He assured CNBC listeners that Saudi Arabia is not lowering the price on purpose to hurt the fracking industry here in the U.S.

    Gold and Silver Stock Mining Package

    We will be coming out with a mining package where we pick what we believe to be the best mining stocks to buy based on my research the last 8 months. We have been patient in releasing this because of the timing in purchasing these mining stocks can be tricky. We were one of the only one's who recommended selling mining stocks in September of 2010 when the HUI was trading at 512.56. Much has transpired in the mining industry since that call with many companies disappearing or being taken over. Today many companies are struggling and if we do get a further pullback in the price of gold and silver, more companies will go bankrupt. Knowing which companies have the best opportunity moving forward will be key to you getting returns that we believe will be in the 100% to 500% range, and possibly much higher for some of the miners. This package will be released in the next few weeks and we will announce it on the site.

    If you are interested in this Gold and Silver Stock Mining Package let us know by clicking this link below and completing the form.

    Gold and Silver Stock Mining Package

    Jan 25 8:55 PM | Link | 4 Comments
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