• ACI - Aug 13 201420140813
  • AEM - Jul 30 201420140730
  • AGNC - Jan 24 201420140124
  • ALIAF - Mar 20 201420140320
  • ANR - Aug 07 201420140807
  • ANV - Mar 05 201420140305
  • AU - Jul 30 201420140730
  • AUQ - Jul 30 201420140730
  • AUY - Aug 12 201420140812
  • CDE - Jun 27 201420140627
  • $CDNX - Apr 03 201420140403
  • CORN - Jul 28 201420140728
  • EGO - Jul 30 201420140730
  • GDX - Aug 12 201420140812
  • GDXJ - Jun 24 201420140624
  • GFI - Aug 28 201420140828
  • GG - Jul 30 201420140730
  • GLD - Aug 26 201420140826
  • $GOLD - Aug 26 201420140826
  • HL - Jul 30 201420140730
  • HMY - Jul 30 201420140730
  • IAG - Jul 30 201420140730
  • KGC - Jul 30 201420140730
  • NEM - Jul 30 201420140730
  • NLY - Jul 03 201420140703
  • NSL - Oct 02 201320131002
  • PAAS - Jul 30 201420140730
  • PWE - Aug 04 201420140804
  • REMX - Aug 08 201420140808
  • SIL - Mar 27 201420140327
  • $SILV ER - Jul 31 201420140731
  • $SILVER - Aug 26 201420140826
  • SLV - Aug 26 201420140826
  • SLW - Jul 30 201420140730
  • SSRI - Jul 30 201420140730
  • VHI - Aug 22 201420140822
  • X - Nov 11 201320131111
  • XVX.TO - Apr 03 201420140403


Long-term Trades

Long-term Trades are trade or investment ideas that have the potential for significant returns over a longer-term period, typically several months or more. This category of trade ideas might be useful for the longer-term swing trader or investor looking for investment ideas to supplement their existing portfolio and prefers a less active, more hands-off approach to investing.

Aug 282014
 

GFI (Gold Fields Ltd) was one of my top picks covered in the July 30th Gold & Gold Mining Sector video.  At the time, had pointed out the nice basing pattern that GFI had formed with the next buy signal to come on a break above the 4.38-4.40 resistance level, which GDI has clearly taken out this week. This gold mining stock has shown some nice relative strength lately having gained 16% since that video was posted less than a month ago while the gold mining sector (GDX) has just chopped around since then and is currently trading slightly below its July 30th close.

GFI was added as a Long-Term Trade setup when the video was published and following the breakout above the 4.40 resistance level, is now considered an Active Long-term Trade. However, despite the recent bullish price action in GFI, I did want to point out that GFI is now approaching a key long-term resistance level that comes in around the 4.70 area as shown on the weekly chart below. Any solid weekly close above that level will trigger the next long-term buy signal for an entry or add-on to an existing position in GFI. Of course, as always, it is imperative to manage your positions in the individual mining stocks along with the charts of both gold ($GOLD/GLD) & the gold mining sector ($HUI/GDX) as the success or failure of these trades, especially when positioning as long-term swing or trend trades, will largely depend on where gold prices are heading.

Bottom line: Although some gold & silver stocks have outperformed the mining sector and may trigger buy signals as they break out of bullish chart patterns or above key downtrend lines or resistance levels, gold & silver, although still looking bullish from a longer-term perspective, remain in somewhat precarious technical positions at this time and still have some work to do in the near-term in order to help solidify the case that a new bull market is underway. Therefore, make sure to use stops and position sizing commensurate with your own trading style & risk tolerance when trading the miners along with proper diversification, particularly if trading individual names vs. the diversified mining ETFs such as GDX, GDXJ, & SIL.

Aug 262014
 

So far, GLD is playing out as expected after moving lower to tag the bottom of the 4-hour triangle pattern followed by a reversal (so far) though there is still a lot of work to be done to strengthen the bullish case, namely a break above the triangle pattern. However, a move below Thursday’s low of 122.45 would certainly dampen the near-term bullish outlook for GLD. Previous & updated 4-hour charts of GLD below:

SLV broke gapped above the 60 minute downtrend line today & is currently backtesting from above. My preferred scenario has prices moving higher but the 18.50 level remains key support, should this breakout fail. Previous & updated 60 minute charts of SLV below:

Aug 222014
 
VHI 2-day Aug 22nd

VHI 2-day Aug 22nd

The VHI (Valhi Inc) long trade has now hit the second price target, T2 at 7.72, for a gain of 40.4%. Consider booking partial or full profits and/or raising stops, depending on your trading plan. As mentioned earlier, this recent move higher has been confirmed on volume with this most recent sharp move on increased volume actually starting the day before this bullish article from Zachs Equity Research was published. T4 remains the final target for now but again, consider at least raising stops to protect profits if holding out for T3 and/or T4. Longer-term traders might consider a stop below the lows put in earlier this month while more active traders might prefer more aggressive stops.

This 4-year, 2-day period chart shows the track record on VHI with 3 out of the 4 trades (including this one) being successful and all three producing gains well into the double-digits. The first short trade in early 2012 hit the 3rd & final target for a 41.3% gain in less than 3 months and reversed sharply upon reaching the final target level. The second & last trade on VHI, also a short trade, was initiated in early 2013 and hit the second target (T2) for a 19.7% gain and continued to fall about a third of the way to T3 before reversing.  In late May, VHI was added as a speculative/aggressive long trade which was stopped out in June. VHI was once again added as an aggressive long entry on the breakout above 5.50 in late June and still looks promising from a longer-term perspective although the stock is quite overbought at this time.

Aug 222014
 
SLV 60 minute Aug 22nd

SLV 60 minute Aug 22nd

With SLV (Silver ETF) having pulled back to nearly the 78.6% Fibonacci retracement level, a break above this bullish falling wedge/contracting channel would likely signal the end of the near-term downtrend in silver prices. The white horizontal lines mark a few of the near-term targets.

Should prices continue much lower, SLV may test the critical 17.75ish support level that marks the mid-2013 & mid-2014 double bottom lows. Any break & sustained move below that level would have longer-term bearish implications for SLV. By sustained, I am referring to anything other than a relatively brief & shallow break below that support level which could serve as a bear-trap/flush-out move assuming prices were to regain the 17.75ish level shortly afterwards (a bullish event).

As of now, I favor a reversal in both GLD & SLV from at or near current levels but remain open to all possibilities as the precious metals are in a somewhat precarious technical position at this time.

Aug 222014
 

After falling mere pennies shy of T2 back on July 7th, VHI is once again making a run at that resistance/target level, coming within 4 cents of T2 earlier today while trading volumes have been increasing lately (a bullish sign). A solid break and close above T2 would open the door for a move to the 3rd & possibly the 4th & final target soon.

There really aren’t many new developments to report on the markets or with the Long Trade ideas other than the fact that I plan to move to the PWE long trade to the Completed Trades category as it had exceeded its previously suggested stop (both a solid move & close below 7.40) the day after the last update on Aug 4th. All trade ideas, winners or losers, are updated when removed for archiving purposes but I need to post the PWE trade removal under a separately tagged post for categorical purposes (email notifications will not be sent as that will be an administrative & not a time-sensitive post). There are also several Active Short Trades that I plan to remove as they have either exceeded a suggested stop or no longer look compelling from an R/R perspective. Those closed trades will be sent out in a single post with any relevant notes on the individual trades & an email notification will be sent when posted.

GLD 4 hour Aug 22nd

GLD 4 hour Aug 22nd

Other than the trade updates, I’m still watching GLD closely and so far, so good as GLD has found support just above the bottom of the symmetrical triangle pattern & the horizontal support zone posted on the 4-hour chart yesterday. My expectation remains that the near-term downtrend in gold prices will reverse soon with a resumption of the intermediate-term uptrend but we’ll most likely have to wait until next week to see if that is the case. As mentioned in last Thursday’s market update, my primary focus & positioning at this time is long gold & the mining sector in anticipation for the next major leg up (although I will start taking defensive measures/reducing my holdings should gold prices break the aforementioned support levels). Although I’m also positioned long with several other individual stocks and ETF, such as select commodity related ETFs,  my overall positioning remains net short with a overweight on the regional bank sector & select financial stocks but as also mentioned in last Thursday’s market update, I do not plan to any more short exposure until/unless prices move back below the upper-most resistance levels (now support) covered in that post. Feel free to contact me if you have any questions regarding any of the Active Trades or Setups listed on the site at this time.

Aug 212014
 
GLD 4 hour Aug 21st

GLD 4 hour Aug 21st

GLD (Gold ETF) has been consolidating within this large symmetrical triangle & is poised to gap towards the bottom of the pattern (along with horizontal support) today. A daily close below the triangle might open the door for a test of the mid & late 2013 lows in GLD. If this intersecting horizontal + trendline support level around the 122.80-123 area is taken out (a daily close below), the next decent support level before a test of the mid & late 2013 lows comes in around 119.40. I favor a bounce off the 123 level but will not be adding any more exposure to gold or the mining sector should prices move below the triangle pattern.

Aug 152014
 

I didn’t hit me until I saw the Russian/Ukraine-induced reversal in GLD a few minutes ago when I checked the 60 minute chart on GLD that I had mistakenly listed the support on GLD which gold was likely to find support at earlier today. In the post that I drafted shortly before the open today I had mistakenly referred to the 124.40 support level in GLD as the 125.40 support level. I had been watching gold futures and the streaming intraday chart of GLD (shown below) and in a rush to try and get that post out as close to opening bell as possible, as I was expecting a likely reversal off the 124.40 area, I had mistakenly referred to it as 125.40 and also mistakenly added that level to the updated 60 minute chart even though GLD was trading about $1 below that level at the time as shown here in the intraday chart.

 

Obviously the reports of an incident with that Russian convoy in the Ukraine that hit the headlines around the time GLD bottomed today at 124.42 certainly gave some tailwinds to the bounce off that level today. Call it lucky timing or the charts playing out (or a little of both) but so far, we are now looking at a successful backfill of that large Aug 6th gap that took GLD clearly out of that 60-120 minute bullish falling wedge pattern. From here, a break above the recent highs of 126.81 would be the next buy signal in GLD while a break below the 124.40 support and especially the 123 support level be bearish.

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