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Gold & Her Flock: Outperformance Time

Stewart Thomson
Nov 22, 2011
  1. Today is options expiry day on the comex. Click this options information link now. A substantial rally in gold is likely, right here, right now, and may have already started from yesterday’s lows.

  2. Now, click this GDX comparison chart. This chart compares the performance of GDX against the Dow. Yesterday was a particularly bad day for the Dow, as concerns intensified about the European quagmire.

  3. GDX put on quite an interesting performance yesterday, and ended trading almost at the high of the day! After trading as low as $54.92, it ended the day at $56.20, just off the $56.21 high.

  4. Given that the Dow closed down almost 250 points, and closed in the lower part of its range for the day, that’s a powerful recovery for GDX.

  5. The comparison chart is a 60 minute chart, and the action of the oscillators suggests GDX is set to begin a move of outperformance against the Dow.

  6. What about the coming performance of GDX against the dollar? Click here now to view the oscillators firing one buy signal after another, almost right across the technical board.

  7. I bought GDX yesterday as low as $55.50, and I am pretty happy with that entry point.

  8. Just as I refer to silver as gold’s little brother or gold’s personal slingshot, I’d like you to think the same way about the relationship of gold junior stocks against the more senior and intermediate issues.

  9. Click this GDXJ slingshot chart now. When gold juniors put on a showcase performance, the percentage gains in just a few trading days can be breathtaking.

  10. All the oscillators are lined up like a team of little golden rockets, set to launch GDXJ higher against the dollar.

  11. What did you eat for breakfast today? Did you walk over to the photocopier machine, turn it on, and then put a bunch of US dollars into your cereal bowl, pour milk all over them, and munch away? Obviously, you had something else to eat, and I’d like you to think very hard about that fact.

  12. Have you ever thought seriously about how powerful an asset food is? Try thinking about going without food, and that will give you a tiny idea of just how powerful food really is.

  13. Click this “all-epic” wheat chart now. I just increased my position, via my PGEN risk capital placement mechanism.

  14. There is a massive down wedge, with extremely bullish implications, and this pattern comes with near-perfect timing, as price is near a “landing” on monster support at the $5.75 low.

  15. Most investors believe that owning food as an asset is “risky”. Most investors are also lifetime market losers. Do you think there is a connection between the two realities? If so, you are correct. By embracing food as one of the ultimate assets, you are distancing yourself from most failed investors, and that is a positive move for you.

  16. So, how do you allocate your capital into wheat? For most investors, the Teucrium wheat ETF (WEAT-NYSE) is probably the simplest approach. At $21 a share, it’s something I’m comfortable allocating capital into at any price between $1-$30, buying in $1 price drops.

  17. Don’t try to build a “wheat Rome” in 24 hours. Just start with a toe in the water, but get it started.

  18. Silver turned in a performance yesterday that rivalled the action in GDX, and certainly outdid gold. Click this silver profit booking chart now. Note the red HSR lines. I’ve highlighted the highs and lows used to create those red lines, with black circles.

  19. Those red lines are your intermediate term profit-booking areas. It’s very important that investors understand the difference between backing up the risk capital allocation truck, and putting on a spacehelmet.

  20. The term “space helmets on” refers to trading less, and holding more of your position for a big move. Amateur investors take the term to mean “buy big” or “buy big, and leverage it!”. That’s a failed strategy.

  21. Another market error involves the view that because something is possibly poised for a huge run, then it should be leveraged. That won’t work in this crisis, because leverage, all leverage, is the target of the banksters.

  22. I believe there are thousands of people in the gold community who are using huge loans from the banksters to leverage silver, and not being very honest about their actions. I note they tend to be maniacally obsessed with a theory that the banksters are going to blow up on the comex, and this action will send leveraged silver prices to infinity, supposedly. The brutal reality is that it will be these leveraged traders, not the banksters or the comex, that are totally blown off the financial map.

  23. If an item offers immense reward, that is your leverage. It’s free, so take it. Why corrupt massive upside reward with loans from the banksters, while feeding yourself a fairy tale that “I’ve got the banksters now!”? Given the failure of the Dow yesterday, I think silver’s performance is particularly positive.

  24. What about our Queen, the gold punisher? All hail the punisher! Click this interesting gold chart now. A number of technicians have noted the MACD crossover, and view that as a sell signal. Perhaps it is, but the shorter term charts are flashing buy signals, and it is important to note the positioning of that crossover, against the background of great negativity in the general gold and fund communities. When an intermediate swing begins, it is common for MACD to flash a sell signal just above the zero line, as it is doing now. All this MACD action does is consolidate this up move. It’s outperformance time for the gold punisher and her flock, against the dollar, and the question is, are you ready to ride?

Nov 22, 2011
Stewart Thomson
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