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Monthly Digger - May 2008


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Still too early:

 

In a major correction, you don't buy until Stochastics hits below 20.

 

And then you take only a small position.

 

If it double dips--below 20, above 20 but staying below 50, and a second decline below 20, you buy the second breakout.

 

We're not there yet.

 

If I'd heeded my own counsel I woundn't have allowed automatic buys of HGU.TO at 20.20 and ABX at 39.23 to have occurred.

 

These were buy orders good for the week as I've been busy in court.

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Dollar/Gold:

 

Here's a chart I "cribbed" from another site.

 

It has to be the best display of the Dollar/Gold inverse relationship that I've seen.

 

Gold has near term support at $850. Dollar has congestion around 73.50-73.90.

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Mark Hulbert sentiment indicator seems to think that "gold timers showing no sign of concern, and that's a bad sign."? http://www.marketwatch.com/news/story/mark...D&dist=hplatest

 

Don't know about you, but I've got the duldrums

664784[/snapback]

 

The weekly chart is probably why most advisors are still bulls.

 

MACD shows increasing highs. Stochastics came off lows below 20 and issued a buy signal.

 

Price and the Bollinger Bands suggest massive support at $850.

 

No doldrums here. Just anxious anticipation--like when you're in the racing blocks just waiting for the "crack" of the starter's pistol.

 

I started accumulating, in a small way, Thursday.

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corrections are confusing. its their nature, its a way to buck all but the strong holders off. looking @the picture 887 is resistance and the 850 80 high is strong support. the daily oscillators are not near over sold the hourlies are Dover Sole. so , i am stepping back and letting the market talk to me. i have raised 10% cash in one account and on the other i am lightly on margin. i am not sure what i will be doing . but for sure i will be holding @least 90% long. as of right now , more. i like to have some cash to buy the lows. it puts me in a good psychology. the powers that be are going to sell us on the fact that there is less inflation/no inflation. the planting of the crops just occurred from here on in the speculation starts as to what size the crop will be, so from the grains side it will play both ways. i am thinking the summer could be weak, but it wont last long. dharma

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corrections are confusing. its their nature, its a way to buck all but the strong holders off. looking @the picture  887 is resistance and the 850 80 high is strong support. the daily oscillators are not near over sold the hourlies are Dover Sole.  so , i am stepping back and letting the market talk to me.  i have raised 10% cash in one account and  on the other i am lightly on margin.  i am not sure what i will be doing . but for sure i will be holding @least 90% long. as of right now , more.  i like to have some cash to buy the lows. it puts me in a good psychology.  the powers that be are going to sell us on the fact that there is less inflation/no inflation. the planting of the crops just occurred from here on in the speculation starts as to what size the crop will be, so from the grains side it will play both ways.  i am thinking the summer could be weak, but it wont last long.  dharma

664790[/snapback]

 

speaking of crops/inflation/agriculture..

 

"You've Never, Ever Considered This Agriculture Investment... " well, which stock?

How about sulfuric acid

http://www.dailywealth.com/archive/2008/may/2008_may_29.asp

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"the largest-volume chemical in the world."

 

"Then there is that great demand pull from China and India."

 

"The boom in metals such as copper and nickel also drives the demand for sulfuric acid."

 

"It turns out that not only is supply tight, but there are all kinds of transportation bottlenecks in delivery ? such as a shortage of rail cars."

Cracking the code:

 

Sulphuric acid, a big enough market to bother with, is being donged by Index Specs, just like the base metals were. The "just so" story is China demand, same as with the metals. There is a shortage of empty railroad cars because full ones are sitting on some railroad siding somewhere waiting for a peak, just like the metals.

 

Are there other candidates? Here is a short List of high volume industrial chemicals. Most are petroleum based, but there are a few others, like sulfuric acid's buddy, Sodium Hydroxide.

 

Aluminium oxide (Al2O3)

Asphalt

Cement, portland, chemicals

Distillates, petroleum, naphtha raffinate pyrolyzate derived, gasoline blending

Fuels, diesel

Gasoline, natural

Gasolines

Kerosine, petroleum

Petroleum

Sodium hydroxide (Na(OH))

Solvent naphtha, petroleum, light aliphatic

Sulfuric acid

 

Full list of high volume industrial chemicals

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I'm optimistic we'll be reversing to the upside nicely after a week or so, but I guess Jesse's projection is still in play until it isn't.

 

I took new positions in the following today:

 

MMG

CHPGF (Chesapeake)

CDOUF (Candente)

JJC (copper ETN)

NGD.

 

Credit to Goobs for mentioning several of these.

 

No one will knock me off. B)

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The impulsive action in the miners looked like a corrective rally.

 

I scalped a dollar profit in both my Thursday trades.

 

Volume was lower in 14 of 15 of the HUI components. AEM was the lone exception.

 

Still too early to enter.

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