Better than Gold?....

Gold...the stuff that riches are made of.....what could be better? Well, it seems that gold miners can be better! When the price of gold falls, the price of gold miners falls more, and vice versa! The price of the ETF of gold miners stocks, GDX. has fallen 69% since its high in Sept 2011 compared to the price of the gold ETF, GLD,  falling only 38%. This may work in my favour as the situation reverses, which I think may be starting to happen.

GDX appears to be rising from a low, there are higher lows in place, it looks like good value, and the volume of trading is relatively high. Is it good to buy when things are cheap or expensive? OK, dont get me going on that one, or we'll be arguing all day.

Is this a trend trade? No, not yet, but I've placed a stop order to go long anyway, and once the trend is established, it will have risen by 50%, I suspect.

2015 06 21 GDX


My stop-loss is below the level of support that can be found in 2008. Would that have been a good time to buy? Betcha it would have been.... the price of GDX doubled in 4 weeks after the low. You'll have to watch my videos to see how this trade goes!

Another good thing about trading an ETF is that it is a sector play, not a gamble on an individual stock. I think this is probably a good thing, and there is probably a strong case for limiting my trading to ETFs instead of individual stocks. There is, however,  something emotionally that holds me back from doing this, which is most likely an ego-trip of trying to prove my (non-existent) prowess as a stock-picker.....

If you want to see my views on the markets last week click here (2 mins)

If you want to see how my open positions performed (or, rather, didn't perform) last week, click here (6 mins)

Remember, this is not advice, I'm just telling you what I am up to.......

Have a great week!


Popular Posts