Issue #182
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For all members who own the following positions: 1. UGLD: SELL HALF your shares of the VelocityShares 3X Long Gold ETN (UGLD) at the market. 2. Cancel and replace your protective sell stop for ALL your UGLD shares at $10.27. NEW ORDER. SELL the remaining half of your UGLD shares at $11.82, stop, good till cancelled. 3. NUGT: SELL HALF your shares of the Direxion Gold Miners Bull ETF (NUGT) at the market. 4. Cancel and replace your protective sell stop for ALL your shares of NUGT at $8.75. NEW ORDER. SELL the remaining half of your NUGT shares at $11.85, stop, good till cancelled. |
Dear Member,
Wow, talk about action! Gold has fulfilled my projections with a swift January rally, reaching as high as $1,267 and change yesterday in the nearby futures contract.
The impetus for the rally: The Swiss National Bank’s (SNB) decision to abandon its peg to the euro, a peg that I said would fail, and that the SNB would have to abandon. The peg has cost the Swiss central bank tens of billions of dollars, as it was selling Swiss francs all along to keep the currency competitive and pegged to the euro.
The euro bought against the sales of Swiss francs has put the central bank in an untenable position of losing billions on the euro – as it has plummeted virtually nonstop.
In turn, this has caused many European investors, seeing the euro plunge, to buy gold, pushing it up sharply.
Importantly, the rally in gold is merely temporary and NOT the start of a new bull market. Please keep that in mind. All we have seen is merely a temporary rally in gold, one that will give way to fresh new lows as the dollar, temporarily correcting, will soon stage yet another strong rally.
If anything at all, yesterday’s move by the Swiss National Bank merely points out what I have been telling you all along – that the euro and the European economy is headed into an abyss.
Right now, however, gold is pressing against pretty strong overhead resistance, as you can see in the chart I have for you here, the lines drawn in coming from my system models.
Very strong resistance lies at the $1,273 level. For gold to move higher – which is possible – it would have to close above the $1,273 level in which case we may see gold test even more important resistance at the $1,300 to $1,310 level.
You have very nice open gains on your shares in UGLD – up to 15.23% based on yesterday’s close – and up to 54.89% on NUGT.
The smart move right now: Take your profits but only on half your position. At the same time, tighten up your stops for the remaining half – which I recommend leaving on the books in the event we see gold make an attempt to test that $1,300 to $1,310 level.
Therefore, all subscribers who own shares in UGLD and NUGT should act on the above recommendations as soon as possible.
Hold your shares in Kinross Gold (KGC) and Eldorado Gold (EGO), both of which are also in the green, and maintain your protective sell stops, good till canceled at $2.45 and $5.50, respectively, for now.
I repeat: This is not yet a new bull market in the precious metals. It is simply the opposite: A rally that is sucking in new longs, giving the metals the energy to soon resume their bear markets. Do not let anyone tell you otherwise.
A few more notes: Crude oil prices have bounced a tad, but here too, oil’s bear market is not over. I will be looking to add a bearish position in oil soon, as oil will NOT bottom until it falls below the $40 level. So stay tuned.
The stock market: It has indeed, and finally, entered a temporary bear market. A close in the Dow Industrials below the 17,300 level today will be very bearish, indicating a move down to as low as 14,500 over the coming weeks.
However, if we get that signal, we will first see a bounce, a bounce that I will use to position you accordingly.
Per my last webinar, I told you 2015 would be one heck of a year for the markets. That is certainly coming true.
New subscribers: Be patient and wait for my next signals before taking any action.
Best wishes, and stay tuned …
Larry
