Monthly Archives: June 2019

Easy money during the second half of this year

It’s been my opinion that the second half of 2019 everything would go up together. I also think trading conditions will become much easier during the second half of the year. Stronger trends, less volatility. The perfect setup to make money if one is able to recognize and adapt to a different environment than you have become used to. Clearly that is already underway in stocks and metals.

It’s probably a little late to be jumping on the metals bandwagon right now though (well at least not leveraged). You already missed a big chunk of that move. That being said I think we’re going to see $1500 before this intermediate cycle tops, but we may have to weather a corrective move first before that move starts. So probably a little late to be backing up the truck in metals. If we get a recognizable pullback that would be your opportunity to load up.

Stocks and energy however are still early in their intermediate cycles. Stocks in particular are potentially setting up to break out of the year and a half consolidation. That is the recipe for a strong sustained move higher (semis’ may finally be ready to breakout of the 20 year base and produce a sustained move that could go insanely far over the next 10 years). And energy is just now beginning a new intermediate degree advance. You haven’t missed much at all in the energy sector yet. So both of these sectors are prime candidates for fresh money.

If you’re tired of losing money listening to the perma bears continuously tell you the world is coming to an end, maybe it’s time to try something different.

Maybe it’s time to start making money from the dominant trend instead of constantly trying to fight it. It’s how I won the challenge this year.

The half price offer is now closed. 

2018/2019 Challenge results

I’m going to go ahead and publish this years results as I don’t think anything will change between now and tomorrows close.

The top place this year goes to… me.

  1. The general SMT portfolio +177%.
  2. Manuel K +151%
  3. The SMT metal portfolio +104% (In this portfolio I restrict myself to only trading metals. So I don’t take opportunities in other sectors in this portfolio)
  4. Allan H + 98%
  5. Charley D +93%

I said last July as this years challenge started that it would be unlikely any of last years winners would repeat and make it back to the top five again this year. I’m the only one that did. The reason it’s hard to repeat is that success one year tends to cause people to use the same strategies the next year expecting to get the same results. However market’s rarely deliver the same market conditions from one year to the next, so repeating the same strategies that put one in the top five last year would be unlikely to do the same this year. And that’s exactly what happened. The only way to have any chance of sustained outperformance is to be able to quickly recognize changing market conditions and adapt to them. Most people are not able to change gears that quickly, and it’s why few hedge funds are able to outperform the indexes over time.

The SMT stock portfolio is up 588% over the last 3 ½ years. The S&P during that time is +44%.

The SMT metal portfolio is up over 1000% over the last 3 ½ years. GDX is +83% during that period.

Starting July 1 we’ll try again and see who can adapt and who can’t. The odds are very much against me reaching the top 5 three years in a row, but I have an idea how I think the market is going to evolve over the next 12 months. We’ll see how things progress and who can take advantage of it, and who gets taken advantage of.

The 2019/2020 challenge will start Monday July 1. I’m going to limit the challenge to 50 people this year. You don’t have to make a trade Monday, but you will have to register by informing me you want to participate. Once I reach 50 entrants I will close the challenge and the games will begin.

Please wait till the market opens on Monday to register.

The other 4 top finishers can contact me ([email protected]) to claim your consolation prizes. 6 months free subscription to the SMT for 2nd place. 3 months free subscription for 3rd thru 5th.

Time to get on board and stop missing opportunities

Let’s face it, many if not most of you missed the rally in the stock market out of the intermediate cycle low, or if you listened to many mainstream analysts you tried to short the rally and got run over.

Many if not most of you missed the rally in gold, or took profits way too soon, or heaven forbid, you tried to short one of the most explosive rallies in the metals in years. The last 6 years conditioned you to only expect bad things from metals. You couldn’t adapt to a new market environment and it cost you a rare opportunity.

Last year so many traders became frustrated with the metals. Gold wasn’t doing what traders wanted it do do. I tried and tried to keep traders focused as I knew good times were coming. Last year gold was building the fuel for the explosive rally out of the cup and handle this year. Most didn’t understand that. They just knew gold was a terrible investment, and so many gave up on the sector. Many at the exact bottom. Now look what they missed.

We are having one of our best years ever, and it’s because we don’t let our emotions control us, we control our emotions. For most traders it’s the other way around (and why most traders and analysts never make any consistent long term compounding gains). Over the last 3 1/2 years the SMT stock portfolio is up 578% and the metal portfolio is up well over 1000%. We don’t win on every trade, but we do win on a consistent long term basis so that the portfolio’s are growing over time, rather than shrinking or stagnating.

It may be a bit late to jump into stocks and metals now. Face it, your emotions cost you that opportunity and it’s not coming back. Yes both sectors still have further to go, probably a lot further, but both are probably going to have to consolidate or pullback for a bit. Buying now is easy, you expect the trend to just keep going and going. But buying when your emotions give you the all clear is more often than not the wrong strategy. The time to buy is when you are scared. 4 weeks ago everyone was scared of stocks and scared of metals. That’s when we were buying, while the rest of you sat on the sidelines. Now that both of those sectors have had explosive moves the rest of you are finally ready to start buying. Not us. We want to do the opposite of what the rest of you do. Most of you are forever on the wrong side of the market. In order to make money we want to do the opposite of what the majority does.

So while I do expect both stocks and gold have much higher prices coming in the future, neither one of these sectors is where I want to put fresh money. At this point we will just let the positions that we bought 4 weeks ago ride. New money needs to find a sector that’s ready to take off, one where your emotions are nervous, not comfortable. In the weekend report I covered where I think new money should be placed next week. A sector that I think is ready to catch up with the rest of the markets.

The half price offer is now closed.

Dollar collapse

Pre FOMC update

Weekend update