72 thoughts on “Portfolio change

  1. 86d4life

    To mirror what the others are saying,thank you for your dedication. Others I have subscribed to, when it was vacation time,your on your own, and the barn door was usually wide open.

    Do you think if the market is going to take a jump, PMs are going to hitch along for the ride, even if for a quick hop before continuing down. Thanks Chief.

  2. Moneyman


    If the market will jump. Will it be to 1310-1320? Somethink like that..

    But ofc we might go down further also..But it seems that sentiment is really bearish..

  3. TommyD

    Welcome back and I hope you rested your brains.

    With all the news out of Europe, and how we bailed out their banks with no money left here in the USA for growth ( Zero hedge material ) I jumped into TBT and as of today it looks like it’s going to run higher.

    Who is going to buy treasuries now that QE2 ends June 30th???? NOBODY is my guess.

    That’s my contribution for what it’s worth…


  4. Ivan

    Gary,Welcome back! I am curious what are your thoughts about Silver drop.If Gold corect until end of the month do you believe we can go under 30 in Silver? Thanks!

  5. 86d4life

    I didn`t even read that whole ZH article. I couldn`t really believe what I was reading. I thought for sure I must have it wrong, like I`m not getting it. Looks like you have a good line of thinking.

    Wanted to wish you the best on the program too. Good for you.

  6. Gary

    I probably wouldn’t hope for much more than a tag of the 10 DMA at this point.

    The dollar already dipped back down to tag it’s 10 DMA this morning. I doubt it’s going to drop back under that level until the current cycle tops. The cycle is only 5 days old so we should have 10+ days of rally left.

    And as long as the dollar is generally rising the market is probably going to struggle.

  7. Gary

    Personally I wouldn’t mess with TBT. If we are going into recession like I think we are and a deflationary scenario is coming then the dollar is going to strengthen. Buying treasuries will garner some interest and the benefit of a sharply rising dollar.

    It’s way too soon to bet on falling treasuries yet IMO.

  8. Haggerty

    Morning All
    Anybody thinking about adding to their gold puts today?

    I was also thinking of adding more DUG today, being the dollar is flat/down a little.

  9. Gary

    As a matter of fact it looks like the dollar is forming a bull flag. Once this breaks out to the upside the rally in stocks will probably fade away.

  10. Gary

    As long as you have a position then you can afford to be patient. Add on a tag of the 10 DMA or if the 3 day RSI rises above 50. Inverse for DUG.

  11. TommyD

    86d4life and Gary,

    Thanks both for your input.
    I seam to ask about TBT about every 3 to 5 months. TBT may never be of any investment purpose unLESS WE LOSE RESERVE CURRENCY STATUS???? Hmmm, a thought there…

    I bailed out of the 2X etf shorts in premarket. Holding very small amount of SH and TBT for now.

  12. Haggerty

    I do have a position and strong hand status so that will allow me to be patient. When you look for 10 dma are you looking at a 3 month chart or six month chart?

  13. Gary

    Personally I find it very tough to make money in bear markets.

    Markets don’t go down the same way they go up.

    My goal is to just make a little money on the bear side while waiting for the gold cycle to bottom.

    But most importantly don’t lose money. So be satisfied with small little profits and don’t swing for the fences.

    As long as we don’t do anything stupid we should easily make back all those lost profits from mis-timing the exit on silver, during gold’s next intermediate cycle.

  14. Haggerty

    Thanks Gary
    Yes I have learned that lesson painfully. That’s exactly what I’m looking to do just make a little money for the bull side of the PM market.

  15. Cool_Loser

    Is there the possibility that the Gold C wave will continue through the summer and into the fall, given no parabolic top and espesically if there isn’t a violent correction in gold (D wave)? I was just curious about.

  16. sophia

    Treasuries are getting a beating so I guess that the proud holder of TBT since yesterday must be happy today! Well done!

  17. Gary

    Doc tends to think gold will just continue to climb steadily higher without a severe D-wave correction.

    I’m kind of up in the air. The miners are saying this is going to be rough but gold didn’t stretch very far above the 200 and it shouldn’t drop below the last intermediate low of 1308 so it’s anybodies guess.

  18. Poly

    We have a failed daily cycle and most likely, soon enough, a failed weekly cycle.

    It’s too late to cover your SP shorts today, market is already gaped. In any event, you shouldn’t think of taking a few points profit, losing much of your strong hand and have to stress about getting in while you potentially miss a 100-200 point move!
    Instead of covering, add or double your short line towards the top of each rally.

    Silver is weak, I’m adding to shorts there. Maybe more oil shorts too, $90 should be the next step there.

  19. Alpine

    Gary, I’m confused
    Why bail on the shorts if, as you say the dollar bull flag looks to break higher and pressure the DOW?

  20. sophia

    Very stupid idea most probably but could we have a ” back to normal ” market for the summer, ie not an hyper inflated market : Gold and Silver would go down and Treasuries as well as no QE3, and Stocks markets stabilise as after all, companies are in OK shapes?

  21. Gary

    Well let me ask you what you will do if the severe sentiment extremes force an intermediate low and we have to re-phase the daily cycle? If you hold into that you will lose your profits and more importantly you will lose money.

    This is why it’s so hard to make money in bear markets. Sentiment gets extremely stretched on the down side spawning violent rallies. If you get caught in them it’s pretty tough not to get kicked off at the top for losses.

    Remember we don’t have confirmation of a bear yet. We would have to have three things happen before I will be comfortable holding shorts for anything other than short term trades.

    One we need a failed intermediate cycle. That hasn’t happened yet.

    We need a Dow theory sell signal. Also hasn’t happened yet.

    And finally the 50 DMA has to move below the 200 and the 200 turn down.

    Until all three of those happen shorts are going to be tricky.

    Like I said my only goal in shorting is to make a little profit and then use it to play the next intermediate cycle in gold.

    So I couldn’t care less if I miss some or even all of the downside right now. It’s more important not to make a mistake and lose money.

  22. Gary

    The selling pressure in the stock market hasn’t gotten extreme enough yet to rub off on everything. I think the miners are predicting a strong dollar rally out of the three year cycle low and a hard decline into an intermediate cycle low.

  23. Edwin

    i’m out of some positions on gold from the break of 1525 yesterday.

    bah i’ll have to wait it out until this correction finishes.

    been buying the SPX for the past 2 weeks. give me something to cheer for in the summer c’mon.

  24. Poly

    No guarantees in trading, just probabilities. But there is no denying the setup at hand points to being short as the best option in front of us. Nobody is saying put the house on it, but build your short line out as we slide down.

    Sure anything is possible and we need to be on the look out for changes to our framework. I know I’m short from $SPX $1,311, so even a rephrasing of cycles and rally from here will get me out with possibly some scratches.

  25. Gary

    Insiders are notoriously bad market timers. They bought every dip of the bear market in 08. How well did that work out?

    Sentiment says we are due for a bounce. The dollar’s three year cycle low and the intermediate stock cycle says it should be a counter trend affair.

    It’s pretty obvious some of you are swing for the fences here trying to make everything back that you lost in the silver trade.

    I would warn you that the time to do that isn’t during the volatile swings of a new bear market beginning but during the next intermediate cycle for gold.

    If you can just be patient you will be rewarded. If not you will probably compound the mistake we made in silver.

  26. William


    Stochastics look like they are about to roll over, I would say drop. Unless Gold pops and silver decides to follow.

  27. Russell

    I read Turd Ferguson’s blog after Dan mentioned it yesterday. It certainly reflected capitulation. He mentioned a 1rst notice being sent out re his futures contracts. Can some future traders please educate me re the notices and expiration timing for these futures. This could affect the price action, right?

  28. Poly

    I think in the coming days, gold is going to attempt to confirm a new cycle that was printed yesterday, not far from it’s 50dma.

    Then a LT cycle with a rising dollar will set up the move to the IT lows nicely. Path of least resistance, IMO.

  29. Harry

    Gary was absolutely right, you can drive yourself nuts with all of these sharp rallies and wiggles. I have about 25% in gold/oil put options now and I’m literally going to have to not check my account for a few weeks if I want to maintain any sanity.

  30. Shalom Bernanke

    I’m still long my miners and now down .25% of total capital. The trade might work out after all, although I’m not adding to positions after the rout they took. I’ve found a good beating will take the starch out of a move, and even if it works the profit potential is diminished.

    No need for me to watch today, so signing off til later. Good luck!

  31. William


    First notice is exactly that, the first notice one receives for physical delivery of the asset on a certain date. The contracts dont expire until later in the month. For example, the gold futures contracts for august have a first notice on july 29th but the last trading day is aug 29th. Since you will not be interested in receiving physical delivery of Gold you would sell your contract before first notice or you can roll it over into the next months contract (sell you aug contract and buy jul) As for the way expiration, or the last trading day effects price action thats another story. Sometimes there is no effect at all.

  32. ...at ease

    I bailed on all (including EUO) but held my GLD and SLV puts. I would rather hang on and play the PMs on the upside with funds intact. Lesson learned: don’t hesitate to jump in, but get out when profits are there on the short side.

  33. ...at ease

    Just to clarify…
    I am out of the model portfolio with a teeny profit, and small loss from EUO and DUG.
    I leave for London tomorrow and don’t have time to mess with trading in and out, so just clearing the decks. Still going to ride the GLD/SLV puts as I have time with those.

  34. ...at ease

    I was counting and smiling at those profits coming in yesterday, I should have sold at the point and took those profits!
    So your tip prior when that happens, time to sell. I have experienced that twice now, so will remember that one going forward.

  35. DG

    Ryan: I tend to sell add-ons at break even if they pull back, so I sold a little EUO yesterday at 17.14 and again later that day at 17.00. Am content to hold what I have left for now (all bought below 16.88).

  36. DG

    At Ease: I wouldn’t necessarily sell everything, but if you are feeling smug and proud of yourself, sell some. The risk is missing getting back in if you are right and we are only half way down.

  37. ...at ease

    Exactly, I was having that feeling again, yesterday with those nice profits coming in. I thought of taking some profits, but didn’t.
    So at least I can recognize that feeling now and not second guess myself. πŸ™‚

  38. DG

    At Ease: Actually I think tactics, risk management, etc. are more important than indicators and harder to do well. It’s an area where I need to improve, as I sometimes find myself “right” on a move and still make little or even lose.

  39. ...at ease

    I agree, I have been working on sizing of orders (entry, add ons)to help towards risk management. But just got that feeling yesterday. So now I can recognize it and take that into trading decisions. πŸ™‚

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