NEM Underperformed The XAU By A Slightly Bearish -0.07% Today
NEM volume was very high again at 9.78 million shares versus 11.43 million shares yesterday. Index fund buying caused by a Federal Reserve Bank credit spike of $9.2 Billion last week was a huge factor yesterday and today, which of course caused many shorts (hedge funds/speculators) to cover. This massive spike should implode soon like a big bubble bursting.
The major int term upcycle channels have expanded again thanks to this two day spike, which means that the minor int term downcycle could be -15% to -20% in order to reach the major int term upcycle trendline at the bottom of the channel OR the channel/trendline may have turned up. After the amazing rally/minor int term upcycle since October 20 for HUI/NEM and since November 4 for NEM a substantial decline is likely.
There's too much risk to trade long or short right now. It makes sense to wait for a minor int term downcycle to establish itself before possibly short selling and/or buying put options, if you have a margin account for short selling and/or are approved for options. I'll be looking to buy more XAU Puts. Ciao
The major int term upcycle channels have expanded again thanks to this two day spike, which means that the minor int term downcycle could be -15% to -20% in order to reach the major int term upcycle trendline at the bottom of the channel OR the channel/trendline may have turned up. After the amazing rally/minor int term upcycle since October 20 for HUI/NEM and since November 4 for NEM a substantial decline is likely.
There's too much risk to trade long or short right now. It makes sense to wait for a minor int term downcycle to establish itself before possibly short selling and/or buying put options, if you have a margin account for short selling and/or are approved for options. I'll be looking to buy more XAU Puts. Ciao
posted by Joe Ferrazzano at
1:11 PM
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