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Truth is timeless: “Markets never change” – Jesse Livermore, 1923 The early masters, Livermore, Wyckoff and Loeb isolated themselves from the crowd and crowd thinking. None of them ever graduated high-school and yet they each became legends in the market. Their techniques have been time-tested.... More
  • GDX: Bulls May Be Trapped........Again 4 comments
    Jun 4, 2014 12:39 PM | about stocks: GDX

    There may be a bull-trap setting up in the Market Vectors Daily Gold Miner ETF (NYSEARCA:GDX).

    The GDX made a slight new high from yesterday's session but held below the 22.54 high from 6/2/14.

    The new high appears to be eroding back into the previous trading range.

    This action is typically referred to as a false breakout.

    (click to enlarge)GDX 30-min Chart

    Chart by TeleChart

    For those who were looking for a low-risk entry point, this may be an opportunity.

    However, we are not going to increase the position size in the Direxion Daily Gold Miner Bear 3X ETF (NYSEARCA:DUST) at this point.

    The current price action is potentially at a mid-point of the overall downward move and as such is not the best location for entry.

    One thing an entry in DUST at this level does offer is a tight stop. That stop would currently be the day's low at 28.60.

    With that kind of tight could be the case of in-today..... out-today.

    Disclosure: I am long DUST.

    Stocks: GDX
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Comments (4)
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  • ptTL9
    , contributor
    Comments (311) | Send Message
    Thank you, Paul


    I am on the side lines, until we get some clarity. ECB and Payroll data are in play this week, hopefully Friday will bring some direction, any way I think we will test 1180 in gold, and NUGT will be at 25.


    4 Jun 2014, 03:56 PM Reply Like
  • Paul Mosgovoy
    , contributor
    Comments (120) | Send Message
    Author’s reply » I appreciate the input,


    If one looks at this whole scenario in the big picture of a continued down-trend (that started on 3/14/14) and heading into a capitulation of some kind. The price action makes sense.


    Prices need to have fuel (volume) and where else is the volume going to come from except from those that are on the wrong side of the trend....whether that is up or down.


    Seems like with this much acquiring of fuel, of those to be positioned onto the wrong side, that the move (up or down) when it comes might be something big.


    As said in earlier posts, I am working this move on a weekly chart and so do not have any kind of exit signal.


    This is probably the longest I have maintained a position in some time.


    It can get a bit dull at times but when the breakout comes, it is good to be in position long before it hits the news and there is panic....because when that happens, it will be time to be looking for the exit of the position....just as everyone is attempting to cash-in on the move. :-)


    Thanks again,


    4 Jun 2014, 04:40 PM Reply Like
  • John Wilson
    , contributor
    Comments (2032) | Send Message
    You're right. It does look like a really sweet ascending triangle preceded by several higher lows. Also the 10 day 30 minute (GG) chart shows an nice rounding or saucer shape too. Both look good. I'm tempted. Maybe for a short term fix I'll sell a few (SLW) puts that will expire in 17 days.
    5 Jun 2014, 12:14 AM Reply Like
  • Paul Mosgovoy
    , contributor
    Comments (120) | Send Message
    Author’s reply » Thank you John,


    Just read your bio.......looks like we are close to the same head-shot needs to be updated as it was taken a few years back. :-)


    I am still using paper for notes and charts. After several fatal hard-drive crashes (one drive will be shipped off for recovery), I am back to some extent using the medium that does not "crash".


    "Realist" is important. A healthy mind-set.


    I like gold. However at this point the trend is not up. Even if it comes back to test the break, the trend is still down.


    I appreciate your input. It is nice to hear from someone that has years of experience.




    5 Jun 2014, 08:06 AM Reply Like
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