Yes we rallied today, and yes the volume was above average for an up day – however selling volume and increased volatility are not generally bullish. Jobless claims are falling – as a result of people being unemployed for 2 years and thus no longer being counted as unemployed. The economy added 217k jobs yesterday, which is a high number, until you consider than you need to add 200k just to employ the people who are entering the workforce – who incidentally also don’t count as unemployed should they be unable to find work because they never had a job to lose. In essence, if you are making up the data as you please, its not hard to show improvement. Drink the cool aid at your own peril – oh and don’t worry about gas costs further eroding the purchasing power of most Americans. Having said all that, I’m still heavily long equities having added more GLD today – more on that later. It is unclear if the primary trend (up) will reverse, as the markets seem intent on moving sideways for now, chopping both longs and shorts with equal abandon. I’m not advocating we are topping out here – although there are some disturbing signs – but caution is warranted.
Onto gold and silver. They sold off today. Some big player kicked me directly in the balls via pushing AVR.TO massively down while I was away from my desk – unable to add (props to kedzilla for swooping on the opportunity with all the grace and instinct of the Canadian Beaver). In addition I was unable to unload half of my NGD calls at a price I wanted. If you were expecting a ride straight up, expect to have perfect timing in entering positions, and do not have the internal fortitude to hold a position that has gone against you (OH NO I’m down 5%) then I suggest you go play with the other children. The markets are not for you. Inevitably all you will accomplish is lose your money in a spree of euphoric buying and panicked selling to those who actually have conviction in the underlying trend and cash on hand from not being retarded. The important questions should be, has anything changed since I bought, have my stops been hit (that I determined BEFORE taking any position), or is this some JPM like fucker pushing prices around to stop out those who don’t have the balls for the ride.
I envision Gold at 1550 before the winter, and silver at 45. Now its in writing – I defy you to prove me wrong. Could I be wrong? Yes. Am I married to the idea? No. Will I blindly trade it? No. Am I holding my largest call position – NGD – into earnings? Yes. No balls, no glory.