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  • Despite Unpresidented Weakness, I Still Hold To My $50 Target For The Triple Leveraged Gold Mining ETF ( NUGT)  [View instapost]
    Thanks for the article. The only part I would respectfully disagree with is, "...If gold should fall another 2 1/2 to 3%, GDX could fall about 3% causing NUGT to fall to the $21.93 low projected above. ..."

    The trend we are in seems to be showing if there is a pullback in gold, there is approximately double pullback in GDX. ie - if gold drops 2.5-3%, we would expect to see GDX down 5-6%. Also, if there is a rise in gold, there may not be an equivalent rise in GDX.

    To say this another way, the ratio of gold price to GDX continues to slip. We continue to set all time highs in this ratio. As late as 4/11 it was in the low to mid 20's and now peaking above 60:1
    Dec 24, 2013. 12:16 PM | Likes Like |Link to Comment
  • Gold And The Miners Set To Immediately Move Higher......Or Not [View instapost]
    Thanks for the commentary. Curious as to what you think of the long-term downward trend which began around mid-September 2012 starting the gold fall from $1800. It seems we have been on nearly a linear decline since that point. Gold made a drastic drop around April 13 and again in July ’13 which gave us some ‘breathing room’ under that linear decline. But recent surges in late August have put us right back up against the line.

    It seems we are at a point where we either break out of that 14 month trend on the positive side, or continue along it which would mean further declines even from this point - and possibly at an accelerated rate?
    Nov 24, 2013. 05:20 AM | Likes Like |Link to Comment
  • Despite Lower Prices In Gold & The Miners (GDX & NUGT), Bullish Undertone Persists  [View instapost]
    ...also since the recent gold low in June '13, gold has recovered about 8% of it's value, GDX has recovered about 3.5%

    So a couple of things may happen:

    1) GDX may be due for a little positive movement, even though gold remains steady. 2) A small upward movement in gold could trigger an exponential upward correction in GDX (sort of what we saw Friday) 3) GDX could become even more disconnected from gold and the ratio slip even higher (ie GDX slip downward at an increasing rate).

    I would tend to favor 1 or 2 if gold can maintain an upward run, or 3 if gold turns down again, though I am far from expert!
    Nov 11, 2013. 12:19 AM | Likes Like |Link to Comment
  • Despite Lower Prices In Gold & The Miners (GDX & NUGT), Bullish Undertone Persists  [View instapost]
    Will certainly be fun to see what the future holds. Interesting thought on the disconnect, nj. I had touched on that a bit earlier asking if gold could maintain value and GDX turn worthless in the same way a new Corvette is $100,000, but GM is bankrupt.

    Looking at Gold:GDX ratio, in the '06-'07 time frame it hovered around 16:1. With the crash of '08 gold fell a little, miners fell a lot and the ratio peaked at about 44:1 before returning to the low 20's:1 in '10. Starting with the latest gold sell off in Sept '11, gold has fallen in value by about 1/3, while GDX is down about 2/3, so the gold:GDX ratio is now in the low to mid 50's.

    Or to look at it 'straight across the board' - the last time gold was in the $1300 range (Q4 '10, and gold was rising fast), GDX was in the low/mid 50's and rising equally fast, and the ratio was about 22:1.

    So either GDX was substantially overvalued back then, or hideously undervalued now. Or a little of both!
    Nov 10, 2013. 09:25 PM | Likes Like |Link to Comment
  • A Path To Profitability For NUGT Holders  [View instapost]
    Long time lurker - first time poster. Interesting reading for sure. Thanks for the continued commentary.

    One big question, how closely are GDX and NUGT related to gold. Often it seems close, but sometimes gold is up and GDX/NUGT still down. I keep reminding myself this is a 'miners' stock. Not too long ago, a new Corvette was $100,000+ and GM was bankrupt. Could we see $1500 gold and $15 NUGT or worse $1.50 NUGT? ie - a great disparity between the cost of the commodity and the stock representing the producers of the commodity?
    Oct 14, 2013. 01:44 AM | Likes Like |Link to Comment