In today’s issue, we’ll recap recent trading activity, deliver two trade recommendations and make an adjustment on Sibanye Gold.
So let’s dive right in with an update on last week’s trades …
First, we exited our long position in Direxion Daily Junior Gold Miners Index Bull 3x Shares (JNUG) for a modest profit. And it’s a good thing we issued a market order when we did, because shares continued to fall ever since, just as our E-Wave cycles predicted.
Second, you should have also been filled last week buying shares of AK Steel Holding Company (AKS) well below our limit price of $6.20. That’s fantastic! Remember, the last time around, AKS handed us big gains of 55.3% in just a few weeks and now we’re looking for a repeat performance.
This trade’s already in profit-territory and yesterday’s bullish outside day reversal puts it on track for a run at our target price near $7.50.
Two NEW trades to make right now …
Trade #1: Exit iShares Silver Trust (SLV)
Silver’s three-week rally off the May 9 low is quickly approaching stiff resistance. Plus, our trusty E-Wave cycle charts tell us another downdraft for silver and gold is fast approaching, with the next cycle low date coming next week. That’s why now is the time to exit this trade with a small loss.
Once the low is in, on or about June 5, silver should enjoy a nice rally higher into August, as you can clearly see above. If the move plays out as forecast, we expect to buy back SLV or another ETF with even more upside profit potential at lower prices.
Here’s what to do right away:
Place an order to sell ALL of your shares of iShares Silver Trust, symbol SLV, at the market. Then, cancel your good-till-canceled protective sell-stop.
Trade #2: Buy a Big Bounce in the Buck
The U.S. dollar has come under selling pressure in recent weeks from a mixture of Trump volatility, softer U.S. inflation data and prospects that the Federal Reserve may be slower to hike rates this year.
But we see these concerns as overblown.
The U.S. is still the best house on the block as far as economic stability. And the Fed seems dead-set on raising rates several more times this year, in spite of recent soft economic data.
In the meantime, the technical condition of the dollar is severely oversold and the E-Wave cycle forecast calls for a sizeable rally into mid-July. See chart below:
Now’s the time to play the coming dollar rally for all it’s worth. And that’s precisely why we recommend call options on the PowerShares DB US Dollar Index Bullish Fund (UUP).
Here’s what we recommend:
Using 5% of the funds you have allocated to this service, buy PowerShares DB US Dollar Index Bullish Fund (UUP) September 15, 2017 call options, with a strike price of $26, symbol UUP170915C00026000 at $0.15 or better. This order is good-till-canceled.
Finally, cancel your protective stop on Sibanye Gold …
Volatility and negative sentiment surrounding Sibanye’s rights offering pushed its shares deeply into oversold territory.
It’s ridiculous how cheap SBGL is now on a fundamental basis, with shares trading below book value of $5.42. That’s why we recommend you take full advantage of the rights offering to add more shares of this high-quality gold and platinum miner on the cheap.
Meanwhile, because of this volatility, we recommend cancelling your protective stop at $4.19. This is a temporary move to prevent being shaken out of the position until the rights offering ends in mid-June.
Here’s what we recommend:
Cancel the good-till-canceled order to sell ALL of your shares of Sibanye Gold, symbol SBGL, at $4.19 on a stop.
We’ll continue to monitor the position closely and will alert you when it’s time to exit.
Hold all other positions and stay tuned for new trades coming your way again very soon.
Good investing,
Mike and David
