- GCRU- Weekly Trading Service

Transcription

1 - GCRU- Weekly Trading Service GCRU #684 April 13, 216 (in its 15 th year) IN THIS EDITION STUMBLE OUT OF THE STARTING GATE 2 Open Positions 19 Abbreviations 2 MARKET LEADERS Gold (futures) 5 Silver (futures) 6 US Dollar Index 7 Crude (futures) 8 Interest Rate 1 Yr T No (TNX) 9 Copper (futures) 1 D. Industrials & D. Transports 11 HUI & Adv/Dec Line 12 STOCKS Agnico Eagle Mines Limited (AEM) 14 Proshares Ultra 2+Year Treasury (UBT) 15 New Gold, Inc. (NGD) 16 Direxion Gold Miners Bear (DUST) 17 The market does what it should do, but not always when" Jesse Livermore Goldcorp Inc (GG) 18 1

2 STUMBLE OUT OF THE STARTING GATE... BUT Gold and gold shares shot up further this week. The weaker Dollar, safe haven buying, some bargain hunting and the Fed's cautious approach to interest rates, were the main reason why. Plus, the plunge in the Dollar versus the yen, and global uncertainty added to the rise as well. Silver also jumped up above $16 yesterday to its Oct highs. It's finally catching up to gold and gold shares, and demand is strong. Silver coin sales were strong in March, and so was silver jewelry. Plus, inflows into silver ETFs remained robust. Our first profit target was hit yesterday, and we took half of our silver profits at 1%. We'll continue to accumulate silver on weakness because it looks like silver is starting to wake up! situation gold shares are in today. This shows gold shares compared to gold, and as you can see, the ratio fell sharply and ongoing, especially during the bear market of recent years. It actually fell below the bottom of the mega down channel! And while it s leading indicator fell to the most extreme level of the last 47 years. Can't get more bombed out than this! The point here is that, while the jump up we've seen since January has been impressive, it's a mere blip up in the big picture. The big picture still has so much room to rise further for the next coming years. This is where big profits will be had. Take a look at the silver price close up. It's strong above its 75 day MA and it's starting to outperform gold. It's been very weak versus gold during the bear market, but it's at an extreme low and a change could be in the making. We'll keep our silver and be ready to buy more on weakness (Chart to the Right). Now is the time to own gold stocks. They took the prize on strength during the run-up. There are opportune times when value is staring at you in the face. Gold shares fit this bill. And this is why we put a big picture of gold shares as our Chart of the Week. This chart starts in 1968 and it reflects the incredible bombed out nature and unique 2

3 This is why we've decided to change our strategy and not trade the downside. Our DUST position is unfortunate. We still think a downward correction will come at some point, put we'd rather lick our wounds now, and focus on buying several gold shares at the best prices possible for the rise coming thereafter. This will be much more profitable. Gold shares are extremely overbought. They had a great ride since their January lows. A ride we did well with up until recent weeks. And now we'll be patient and buy at the best value possible. We'll average in on the downside at key levels. We'll also keep our position in gold, and also keep an open position to buy more at a better price. The Next Chart is a good eye opener. It's yet another bullish confirm to add to the others that have already been ticked off. It's a moving average bullish crossing on and when it does, it tends to precede a major bull market rise, see red circles. As the months pass, bullishness continues to grow. 216 certainly looks set to become a turnaround year. Crude oil shot up this week pushing investors away from bonds, but bonds are still on the rise and we'll keep our UBT position. In fact, it's getting closer to our first profit target which means you may be selling half one of these days. The stock market still looks like a top is forming for the bear market rebound rise. We'll watch this from the sidelines for now. The dollar index is now very close to turning bearish. Keep an eye on This level may hold for now because the dollar is oversold, but thereafter the dollar looks poised for more weakness later this year. Our strategy for this week is to keep an eye on the open orders in gold, silver and our three gold shares. Buy when they're triggered. Also keep an eye on profit targets in UBT. We'll be patient and wait like a tiger for good levels to jump in. Good luck and good trading, gold. Note that the 15 week MA has now risen above the 65 week MA for the first time since 29. This doesn't happen often Omar Ayales Chief Trading Strategist GCRU A division of Aden Research Group 3

4 MARKET LEADERS 4

5 GOLD JUNE 216 (GCM16) 4/12/216 CLOSE = RESURGING STRENGTH! STRONG ABOVE $122 A DEC MAR FEB BREAKING BULLISH! O N D J F M A Put Spread Bought Jun /18 gold put spread at $4. Long 126 (Mar-4 & 7-16) (GLD: 121) Stops 2dc below 1145 (GLD: 19) (adj) Profit Targets 14 & 15 (GLD: 133 & 143). New Recom Keep your positions. Buy some again near 12 and more on a decline to 117. Gold reconfirms support above 12. It's rising above Mar downtrend and resistance with impressive strength! Gold also broke above its key 5wk MA while its Spinner crossed above zero showing renewed strength and rising momentum. Gold will remain very bullish by staying above its 5wk MA at 124, and it has good support above 12. Gold's next test to the upside will be the Mar highs near 128. A clear break above this high on a 2dc would show renewed strength that could push gold above 13, a key resistance area, the Jan 215 high. On the downside, raise your stops to 2dc below 1145, the Dec uptrend and support level. As long as gold holds above the Dec uptrend, it'll remain MT-LT bullish. 5

6 SILVER MAY 216 (SIK16) 4/12/216 CLOSE= OCT JUMPED TO OCT HIGHS! FEB MAR Long at: Stop (Dec-17-15) (SLV: 13.1), 13.9 (Dec-28-15), 13.9 (Jan-8-14) (SLV: 13.15). Sold half at (SLV: 14.5) for an average 1% return; (Feb-26-16) (SLV: 14.5), 14.9 (Apr-1-16) (SLV: 14.2). Sold half at 16 for an average 1% gain. 2dc below (adj) (SLV: 2dc below 14.45) (adj). Profit Target 16 (reached!) & 17.5 (SLV: 17) New Recom: DEC O N D J F M A BOUNCED UP FROM UPTREND + CROSSING ZERO = BULLISH! Keep your positions. Sell second half at second profit target. Buy more near Silver surged past its resistance at 16 after gold rose from its bullish support near 12, and the resource sector bounced up. Notice Spinner holding and bouncing up from its uptrend. This tells us momentum continues to rise as Spinner turns bullish with room to rise further. Silver will remain very bullish by staying above 16 but it has solid footing at the Jan uptrend near 15. We recommend keeping the second half of your position and selling at our second profit target near 17. If silver were to decline and hold at its Jan uptrend, we recommend picking up more then. 6

7 U.S. DOLLAR INDEX JUNE 216 (DXM16) 4/12/216 CLOSE= MAR 215 TESTING KEY SUPPORT NEAR DEC 12 1 MAR MAY AUG FELL TO OCT LOWS SPINNER YEAR LONG WEAKNESS IS KEY M A M J J A S O N D J F M A New Recom Stay out The dollar declined to the Aug 215 lows, approaching and testing its key support near Weakness remains a constant during the entire year-long sideways band when the dollar failed to break above key resistance levels. However, the dollar must break below on a 2dc before showing a shift in trend. If the dollar turns bearish, it would be bullish for gold, silver and most assets across the board. On the upside, the dollar is forming a downside wedge near the critical support at A rise above 95 would push the dollar to its target near A break above this level would show renewed strength that could push the dollar above its resistance near the 1-12 level. Keep in mind, strength in the dollar could add pressure to all assets across the board. 7

8 LIGHT CRUDE OIL MAY 215 (CLK16) 4/12/216 CLOSE= RESISTANCE TESTING KEY RESISTANCE FEB MAR ABOVE ZERO & MT MA J F M A ProShares UltraShort Bloomberg Crude Oil (SCO) 4/12/216 CLOSE= 14.8 MAR J F M A Put Spread Nov /2 Bear Put Spread at $6 (Mar-3-16). Long at 119 (Apr-8-16) Sold all at 11 for a small loss. Recom: Keep your put spread. Recom Stay out for now. Crude turned around and rose with strength on speculation that Saudi Arabia and Russia will reach an agreement to curb production. Moreover, shale oil producers are cutting back at a fast pace adding to crude's support near Crude is now at a key resistance level and it's starting to break above it. If Crude now stays above 42, on a 2dc, it'll confirm recent strength and a rise to the higher 4s would then be likely. However, if not, it'll decline once again, likely breaking below the Jan uptrend. The chart of the right, SCO, shows increasing weakness as it broke below the Mar uptrend after failing to break above the Jan downtrend. However, keep in mind production remains at record levels and it could continue despite efforts to curb production. We got stopped out of SCO for a small loss but we'll be keeping our put spread in crude. 8

9 CBOE Interest Rate 1 Year T No (^TNX) 4/12/216 CLOSE= 1.78 US$ NOV DEC OCT 2.15 MAR 2.5 VULNERABLE BELOW 1.85 SUPPORT NEAR FEB LOWS FEB LACKLUSTER O N D J F M A CBOE Interest Rate 1 Year T No (^TNX) - Chicago options Interest rates declined to a 6 wk low as downside pressure intensifies. TNX will remain under pressure by staying below Notice Spinner flatening at a low area. This tells us more downside is likely. TNX's support is at A break below 1.65 on a 2dc will confirm weakness and a decline to lower lows would then be likely. We'll continue to ride bonds for now. 9

10 COPPER MAY 216 (HGK16) 4/12/216 CLOSE= SEPT BOUNCING UP FROM LOWS 2.42 MAR ? SPINNER CONTINUES TO LOOK FOR A BOTTOM O N D J F M A -.15 Copper, fell to its Feb lows, but it's now bouncing up from an adjusted uptrend and low area. Spinner remains at an extreme oversold level and it continues to signal limited downside. Could a jump up be in the making? Only time will tell, but if copper rebounds from current levels, it'll have to rise above the Mar downtrend above 2.15 on a 2dc, initially to show some strength that could push copper to test its more important resistance at the Sept downtrend near

11 SPDR DOW JONES INDUSTRIAL (DIA) 4/12/216 CLOSE= CONTINUES TO RESIST DESPITE BREAKOUT LAST WEEK 182 NOV DEC FEB AUG FLIRTING WITH THE BEAR A S O N D J F M A BEARISH MACD (12, 26, 9) MACD (12, 26, 9) A S O N D J F M A AUG AUG Shares Transportation Average (^IYT) 4/12/216 CLOSE= NOV HOLDING ABOVE UPTREND BEARISH WITH ROOM TO DECLINE FURTHER A S O N D J F M A A S O N D J F M A BEARISH MAR New Recom Stay out. The stock market reached a stop on the road to higher levels. The Industrials broke above a key resistance last week but has gone sideways since while the Transports decline. Indicators continue to show room for more downside. This tells us downside pressure remains strong, and the stock market is poised to resume its bear market trend. Keep a close eye on the Jan uptrend in Transports. A break below this level on a 2dc below 76 (IYT: 136) would confirm continued weakness that could lead the stock market to lower levels. On the upside, if Transports hold above this uptrend and support, we could see stocks resume their bear market rise. Keep in mind a break above the all time highs on both averages is needed to see a bullish Dow Theory confirmation. Until then, the bear will remain in charge. 11

12 ADEN GOLD STOCKS ADV/DEC LINE 4/12/216 CLOSE = DAY MA NOV BULLISH BREAKOUT! 75 DAY MA IS SUPPORT N D J F M A HUI GOLD BUGS INDEX (HUI) 4/12/216 CLOSE= BULLISH BREAKOUT! MAR MAR DEC J F M A JUMPING UP! BULLISH! MACD (12, 26, 9) RISING MACD (12, 26, 9) TURNING BULLISH... N D J F M A J F M A Bullish! HUI held on to its Jan uptrend and rose above the top side of a month long sideways consolidation band showing renewed strength. The A/D Line confirmed the bullish move by breaking out a consolidation band of its own. The A/D Line's Spinner held on to its uptrend and rose above the zero line showing growing momentum with room to rise further. Likewise, HUI's Spinner burst past both zero and the MT MA showing a bullish shift in momentum. Both of these breakouts are confirming renewed strength while gold shares continue to catch up to gold. It is clear gold shares have been extremely undervalued and depressed. This coupled with gold's renewed strength during 216 has been the catalyst for gold shares' recent rise. On the downside, most of our indicators remain overbought, telling us a correction is still poised to occur. However, we'll refrain from trading the downside for now and change our strategy moving forward to building up our gold and gold share positions. 12

13 STOCKS 13

14 Agnico Eagle Mines Limited (AEM) 4/12/216 CLOSE= 41.8 SEPT 2+ MONTH HIGH! BULLISH BREAK ABOVE TOP SIDE OF BAND STRONG ABOVE 37 S O N D J F M A SEPT UPTREND IS MAIN SUPPORT BULLISH! Agnico Eagle Mines Limited (AEM) - Nyse New Recom: OPEN ORDER Buy on a pull back near 39 and more on a decline to 37. Place stops at 2dc below 36. Profit target at 55. AEM broke above the top side of a month long sidways band with strength, reaching a 2+ month high! AEM's next resistance is 42, the intraday high from Jul 214. A break above 42 on a 2dc would show strength that could boost AEM to its next real resistance in the mid 5s which are highs last seen in 212 (an approximate 35% rise from current levels). On the downside, the 5wk MA near 37 is key. If AEM stays above this level, it'll be positioned to rise to 212 resistance. We recommend buying some on a pull back below 4 and more on a decline to

15 PROSHARES ULTRA 2+Year Treasury (UBT) 4/12/216 CLOSE= BULLISH ASCENDING TRIANGLE SHOWS GOOD UPSIDE POTENTIAL ON A BREAK ABOVE 9 NOV DEC N D J F M A FEB BULLISH ABOVE ZERO ProShares Ultra 2+ Year Treasury (UBT) -NYSEArca Long at: (Mar-3-16). Stop 2dc below 86. Profit Target 92 (almost reached!) & 1 New Recom: Keep your positions. Sell half at first profit target. UBT showing some softness after failing to break above an important resistance near 9. However, UBT continues to hold above the Dec uptrend at 86 and will continue to show strength by staying above it. Together with the 9 level resistance, the Dec uptrend is forming a bullish ascending triangle. Remember ascending triangles are continuation patterns. This means if UBT breaks above 9 on a 2dc, it'll be very bullish and positioned to rise initialy to our first profit target at 92. On the downside, a break below 86 on a 2dc could show a shift in trend. 15

16 New Gold, Inc. (NGD) 4/12/216 CLOSE= 4.22 US$ 4.5 NEW HIGHS, RISING WEDGE STILL FORMING JUN BULLISH BUT NEAR EXTREME OVERBOUGHT J J A S O N D J F M A New Gold, Inc. (NGD) -Nyse mkt New Recom: Buy on a decline below 4 and more near 3.8. Place stops on 2dc below Profit targets at 5 and 6.5. NGD rose to new 14 month highs showing impressive strength. Spinner is at an extreme overbought level telling us a pull back is likely. Moreover, NGD will remain bullish by staying above the Jan uptrend & 25 day MA, both at 3.8. A break below 3.8 on a 2dc could push NGD to its next support at 3.5. Buy on a dip below 4 and more near

17 FEB DIREXION GOLD MINERS BEAR 3X Shrs (DUST) 4/12/216 CLOSE= 2.6 BROKE BELOW SUPPORT = BEARISH ROLLING OVER BELOW ZERO F M A -7 GOLD MINER BEAR 3X DIREXION (NYSE: DUST) Long at: 3.6 (Mar-24-16), 3.15 (Apr-6-16), 2.7 (Apr-8-16). Sold at 2.15 on average for a 31% loss. New Recom: Stay out. We were hit with our DUST position this week. DUST broke below a key support level at 3. Spinner is now rolling over below the zero level telling us momentum for DUST has peaked. Overall, the bull market in gold and gold shares is very strong and, even though gold shares are overbought and a correction is likely upcoming, we recommend staying out from the short side for now and concentrate on building up your gold share position which has more upside potential than downside risk. 17

18 Goldcorp Inc. (GG) 4/12/216 CLOSE= NEW HIGHS IN AN UPSIDE WEDGE O N D J F M A Goldcorp Inc. (GG) -NYSE New Recom: RISING WITH ROOM TO RISE FURTHER Buy on a pull back below 17. Place stops at 2dc below Profit targets at 2 & GG rose to new highs for the move showing renewed strength. However, it's resisting at the 212 downtrend. A break above 18 on a 2dc would confirm a breakout from this trend and a rise to the May 215 level near 2 would then be likely. Spinner breaking above zero and its MT MA has room to rise further. GG is looking very strong as long as it holds above the Jan uptrend near We recommend buying near

19 OPEN POSITIONS Status Symbol Trade Update &/or Current Position (L=Long, S= Short, O= Out P= Put C= Call) Initial Entry Date Initial Entry Price Traders rebot/ -sold at Last Closing Price Stops Target #1 Target #2 SHARES GG Buy on a pull back near 17. Place stops at 2dc below Profit targets at 2 & 24. O dc below DUST Stay out. O 2.6 AEM Buy on a pull back below 4 and more on a decline to 37. Place stops at 2dc below 36. Profit target at 55. O dc below NGD Buy on a decline below 4 and more near 3.8. Place stops on 2dc below Profit targets at 5 and 6.5. O dc below UBT Keep your positions. Sell half at first profit target. L Mar dc below MARKET LEADERS Gold - GCM16 Keep your positions. Buy some again near 12 and more on a decline to 117. L Mar-4 & dc below Crude- CLK16 Keep your put spread. P Silver SIK16 Keep your positions. Sell second half at second profit target. Buy more near 15. L Dec , 13.9, 14.75, dc below US Dollar DXM16 Stay out. O COPPER HGK16 Stay out. O

20 Quoting GCRU is permitted provided GCRU name, website address & subscription price are given. All charts in GCRU are daily prices. Fax subscribers please note this week s password to access GCRU daily edition via our website is: (stumble). Subscribers can obtain free online chart updates for all gold shares in GCRU via: To view Canadian stks please use CA as prefix (ie, to view Agnico Eagle (Toronto) you must use CA:AEM). Note: U should NOT feel our recommended prices are set in concrete. If mkts suddenly feel hot or cold to U, or dramatic news occurs, U can buy or sell, or stop at slightly higher or slightly lower prices. It also hinges on your experience level. Some people can use our prices as guides & know when they can take bigger risks. Spinner: Spinner is an in-house momentum indicator (not always shown on charts). Momentum indicators use the rate of change in price to determine predominant energy flows. Spinner trading signals are generated when the faster timing line crosses above or below the slower confirming line. Upside crosses in the lower range of positive territory offer the most reliable signals for longs; downside crosses in the top range of negative territory for shorts. Avoid trading against the timing line, ie, buying/selling if the timing line is in corrective mode (against direction of trade) unless the 1dc 2dc bot CAD$ H&S LOC LT MT NL PF PO Recom RH&S RS ST Sym/tri Tgt Unch Vol Wk Ystdy C ABBREVIATIONS 1-day close (the share price must close above or below the indicated price level, before our recommendation is activated) 2-day close (consecutive) bought Canadian dollar head & shoulder line on close long term medium term neckline portfolio price objective recommended reverse head & shoulder relative strength short term symmetrical triangle target unchanged volume week yesterday close confirming line is positioning for a new 'confirming cycle'. It's important to always be aware of location, direction & cycling phase of the confirming line. Spinner signals are more effective in trending mkt's than in trading ranges where indicators such as Stochastics & Williams %R should be used. NOTE: payments for GCRU services should be made payable to MAP CUSTOMER SERVICE. Gold (& mkts) Charts R Us is published weekly. You may sign up for 3-mos at $3, 6-mos at $585, 9-mos at $855 or 12-mos $1,11. gcru@adenforecast.com - DISCLAIMER - Due to the electronic nature of s, there is a risk that the information contained in this message has been modified. Consequently Gold (& mkts) Charts R Us can accept no responsibility or liability as to the completeness or accuracy of the information. Whilst efforts are made to safeguard messages and attachments, Gold (& mkts) Charts R Us cannot guarantee that messages or attachments are virus free, do not contain malicious code or are compatible with your electronic systems and does not accept liability in respect of viruses, malicious code or any related problems that you may experience. Information in Gold (& mkts) Charts R Us is for general information only & is not intended to be relied upon by individual readers in making specific investment decisions. Appropriate independent advice should be obtained before making any such decisions. Gold (& mkts) Charts R Us do not guarantee or assure that readers will make money, or accept liability for any loss suffered by readers as a result of any such decision. Futures and share trading involves risk and is not for all investors. Past performance is NOT indicative of future results. Trading involves risk and should be pursued with risk capital only! 2