"As a technician, I feel that there are few analysts that offer value for me, but you do. Your work on Gold ratios has helped my analysis greatly." --Jordan Roy-Byrne, CMT (The Daily Gold) 4.9.10

Monday, September 22, 2008

Huey - panic (in a good way)

Okay, off the grand macro horse and back to what I enjoy more; charting, trading and investing in what IS. And what IS is that people are chasing the gold stocks higher in a panic to protect themselves from the inflation whopper on deck.

Of course you know what happens when the bi-polar momo crowd comes thundering in now don't you? They likely will get their asses corrected but good. While I have taken a bit off the table and done some rotating among miners, I cannot find very much in my portfolios that I want to be without, so while I have a decent cash level to take advantage of the inevitable correction, I will likely take a hit as I stick with the mode I have mostly adopted since summer '07; not trading myself out of positions in what stand to be THE initial market leaders of the new normalcy. Here is HUI's progress off the bottom.

You do what you must do. It is your money and this is not a drill. This is real life and real markets and policy makers could suddenly come to their senses. Nahhh, that couldn't happen could it?

Edit (2:52)
Well, I broke it off with Gigi for good. She was going uptown on me. She paid me 40% in a week on these remaining shares and for that she might have expected me to start doing housework or attending PTA meetings... I can't take on that baggage. We're done. But I forgot to mention that Silvia is back in the fold in all accounts as of Friday. Okay, that's really enough of the dating shtick. I am trying to manage a balance here as I go out of my comfort zone (i bottom feeder) and watch wild eyed momo's take my favorite stocks higher. But I remember in 2003 it was often a big mistake to trade out of these things. I wrote last week that when the miners launch it will be a thing to behold. Well, was the man right or was he right? I remain locked and loaded on all must have miners with the right amount (for me) of cash for comfort. Edit (3:47) This is a scary day for broad market participants but two things jump out at me: 1) The major indexes are at this point merely filling gaps after the explosive lift off of the Paulson pump but 2) unlike the gold stocks which did the same thing three days into their explosive rally, the broads are in danger of painting bearish engulfing candles today, which would imply additional short term downside before any would-be rally gets going again.