• AGNC - Jan 24 201420140124
  • ALIAF - Mar 20 201420140320
  • ANV - Mar 05 201420140305
  • AUY - Apr 16 201420140416
  • $CDNX - Apr 03 201420140403
  • EGO - Jul 10 201420140710
  • GDX - Jun 24 201420140624
  • GDXJ - Jun 24 201420140624
  • GLD - Jun 23 201420140623
  • $GOLD - Jun 23 201420140623
  • HL - Mar 06 201420140306
  • HMY - Mar 26 201420140326
  • KGC - Mar 06 201420140306
  • NEM - Mar 26 201420140326
  • NLY - Feb 27 201420140227
  • NSL - Oct 02 201320131002
  • PWE - May 29 201420140529
  • SIL - Jun 06 201420140606
  • $SILVER - Jun 19 201420140619
  • SLV - Jun 19 201420140619
  • VHI - Jul 22 201420140722
  • XVX.TO - Apr 03 201420140403


Active Trades – Long

Active Trades are trade ideas that were previously posted as Trade Setups and have since triggered an entry or occasionally, a trade idea that was first posted directly to the active trades category as offering an objective entry at the time of the initial post. Active Trades might also be listed in one or more of the other trade categories as these categories are not necessarily mutually exclusive. E.g.- An Active Trade that still offers an objective entry might also be categorized under the Trade Setups category. Likewise, an Active Trade with multiple prices targets may have already hit one or more of those initial targets with additional target(s) remaining, thereby falling under both the Active Trades and Completed Categories. Traders should look to make any new entries or add to existing Active Trades objectively, such as a on pullback to a support level during an uptrend or a re-test of a broken trend-line, wedge, or channel pattern.

Jul 222014
 

The VHI (Valhi Inc) Active Long Trade appears to be breaking out of a bull flag continuation pattern today. VHI triggered a long entry on a break above the 5.50 resistance level on June 25th & is currently trading about 28% above that level after gaining about 40% before pulling back. That pullback, which was greatly needed in order to work off the extreme near-term overbought conditions, resulted in prices moving gradually lower on diminishing volume, which is what you want to see during a pullback or consolidation within a bullish trend. That pullback formed what appears to be a bull flag continuation pattern and today prices have broken above the pattern and have been building on those gains so far. The previous & updated 60 minute charts are posted below but the official profit targets remain as previous posted on the daily chart (click the VHI symbol tag at the bottom of this post to view all prior notes & charts on this trade).

I will say that I would prefer to see a considerable expansion of volume on the breakout of this pattern which so far, is not the case. However, price action comes first in my book, volume second, so for now I’m watching to see if VHI can take out the recent highs of 7.63 put in a place about two weeks ago. Such a move, especially if we start to see an increase in volume as the stock rises, would increase the odds of VHI moving up to at least the 8.10 resistance area, if not all the way to the 10.20ish area, which is about where the bull flag pattern projects to. As stated earlier, this is an very aggressive trade so as always, DYODD and consider adjusting position sizing to account for the above average risk & return potential.

Jul 102014
 
EGO stock chart

EGO Third Price Target Hit

The EGO (Eldorado Gold) Long-Term Trade idea hit the third profit target (T3) yesterday, as well as today, for a 36% gain from entry. As discussed in the mining sector video posted earlier today, the odds for a pullback in the mining stocks are quite elevated at this time and that holds true for EGO as well.

Not only are reactions off the price target levels typical in general but EGO is also coming off overbought levels (on the daily RSI) not seen since the stock peaked in Sept 2012 as highlighted on the left of this updated daily chart. I don’t expect anything remotely close to the 46% plunge in the stock that immediately followed that previous similar overbought condition, as that one had occurred during the early stages of the recent bear market in the mining sector whereas this time around, the stock is most likely in the early stages of a new bull market.

I’ve also added an very steep uptrend line on which prices current sit precariously on top of. Any solid break or daily close below that trendline would likely spark a correction which could provide another objective entry in the near future.  T5 remains the final long-term target at this time but again, the odds of at least a decent correction before EGO gets there is quite elevated at this time. Additional details on this trade, including the longer-term bullish case, can be viewed in the Gold & Silver Trade Ideas video posted on June 13th.

Click here to view the live, annotated chart of EGO.

Jul 012014
 
VHI Valhi stock chart

VHI First Profit Target Hit

VHI (Valhi Inc) has now hit the first price target for a quick 26.4% gain in less than one week. Consider booking full or partial profits and/or raising stops if holding out for any of the additional targets.

For those new to Right Side of the Chart, multiple price targets are often used for the trade ideas to accommodate various trading styles (e.g- very active traders who prefer to book relatively shallow, quick profits & move on to the next trade; typical swing traders with holding periods measured in weeks or months; trend traders & investors who attempt to catch the bulk of a trend in a position, etc…).

Various criteria go into determining the price target levels such as significant price support/resistance levels, Fibonacci retracements, volume-at-price clusters, etc… Typically, price targets are set at level where a reaction (i.e.- pullback and/or brief consolidation period) is likely upon the initial tag of that level. Price targets (T1, T2, etc…) are usually set slightly below the actual resistance level for longs (slightly above for shorts) to help minimize the chances of missing a fill, should the position reverse just shy of support/resistance. Some traders might opt to book partial profits as certain targets are hit while very active traders might even micro-manage their trades around these levels (e.g.- reversing a trade from long to short at a target where a reaction is highly likely, then recycling back into the original direction of the trade either on the pullback or once that target level is cleared.)

Whatever your individual trading style is, the important thing is to have a trading plan in place for each trade which includes: How much capital you want to commit to the position; Whether you plan to scale into the position (average in) or take a full position upon your entry trigger; What your entry trigger will be; Your profit target(s) if the trade is successful as well as your stop level(s), if the trade does not pan out.

Jul 012014
 

As I had stated in this post last Wednesday, from the looks of the recent continued selling by the Foundation, it appears that the supply/demand equation may have reached an equilibrium point around the 5.00 level as the continued insider selling in recent sessions has been met with nearly an equal amount of buyers to soak up the supply.  With VHI (Valhi Inc) now up 36% since hitting a multi-year low of 4.98 the day before that statement was made, as well as looking at the massive volume on the steep price advance since then, I believe that the odds are now very good that VHI has seen what will likely prove to be a lasting bottom in the stock.

Continue reading »

Jun 262014
 

After hitting the first target yesterday for a quick 5.5% gain, VHI (Valhi Inc) pulled back to the 5.50 former resistance level, which is now support, before moving sharply higher. Volume on yesterday’s move was extremely high & volume continues to track well above average so far today, which helps to set this most recent counter-trend rally apart from the previous rallies that proved fleeting.

Although subject to change as the stock trades going forward, my current preferred target is the 7.75 resistance level (with my actual sell order likely to be place 10-15 cents below). Now that the 5.50 breakout level has been successfully backtested, consider a stop slightly below that level. The stock is also currently challenging this downtrend line resistance shown on this 4-hour chart. A break above would likely send prices moving quickly towards the previous reaction high of 6.80.

Jun 252014
 
VHI 60 minute June 25th

VHI 60 minute June 25th

VHI (Valhi Inc) has taken out the 5.50 resistance level, triggering an entry for the most recent aggressive trade posted earlier today. I have added some near-term resistance levels to this 60 minute chart which can be used as price targets. Normally I list my price targets slightly below the actual resistance level in order to help avoid missing a fill, should the stock reverse just shy of resistance. However, I wanted to get this chart out asap due to the potential for a fast move in VHI, should the momentum traders start piling in. As such, consider setting your sell limit order slightly below your preferred target level(s). Stops should be dependent on one’s unique cost basis and preferred target(s), as well as their own trading style. Remember, limit orders to buy & sell are usually preferable in thinly traded stocks however, when trading volumes pick-up, like they have on VHI today, market orders can be used I’ve noticed the spread running tight from about 1-3 cents so far today.

Jun 242014
 

The first chart below is the 60 minute chart of GDX posted yesterday in which I listed my pullback targets. As GDX was still solidly entrenched in an uptrend at the time, I had placed the top of Fibonacci retracement at the top prices at that time, figuring that a near-term top wasn’t far away. As such, the key retracement levels that I am currently targeting, the 38.2% & 50% levels, came in just below horizontal support levels on that chart. Following the marginal new highs put in following today’s gap higher in GDX, I have adjusted the Fibs to reflect what I now feel more confident to be the near-term top in the gold miners that I was looking for and as you can see in the second chart below, today’s updated 60 minute GDX chart, those key Fib retracement levels of 38.25 & 50% now come in right at horizontal support levels, something that I look for to provide additional validation for a support level and/or price target. The third chart is a daily chart of GDXJ (Junior Gold Miners ETF) with some likely pullback targets, the first of which being Thursday’s gap which triggered the impulsive breakout above the primary downtrend just as with GDX, GLD, $GOLD, etc…

I wish that I could say that I had a strong preference for which support level is likely to be the final one hit, assuming of course that I’m even correct about a short-term top being put in place at this morning’s highs. I will say that I am leaning towards a pullback to the S3 level on GDX, which comes in around 24.80, but I wouldn’t be surprised to see GDX find support & go on to make new highs from any of these levels. Should GDX continue lower to find support at only the first or second support levels (S1 or S2) before moving sharply higher, that would indicate a very strong bid underneath the mining stocks and bode well for the intermediate outlook for the sector. As usually, my plan will be to gradually & systematically add back the exposure to the mining sector that I recently reduced as my profit targets were hit over the last week, focusing on the technicals of both the sectors (GDX, SIL, GDXJ, etc…), the metals (GLD, SLV, $GOLD, etc..) and of course, any specific individual mining stocks that I plan to trade or recycle back into after booking profits.