This is a continuation of my previous post on gold miners. I would recommend checking out that post and the updates to get up to speed on the current trade.
Profits so far should be at least 15% if you’re trading leveraged ETF ($DUST). Personally at around 20% gain so far in the trade.
I plan to take profits on the entire DUST position soon since GDX is getting close to oversold levels. Probably has a few more days of selling to go based on today’s heavy downward momentum.
Maintain overall bearish view of gold miners as long as there is a lack of negative macro news flow to boost gold prices. I’ll be updating this post daily in case general market sentiment start reversing from positive to negative, check this post regularly if you want to get a head start on trading the reversal!
You can try to scalp the bounce off the support once GDX is oversold, but don’t over-commit because it’s hard to precisely say how much it’ll bounce.
Profits so far should be at least 15% if you’re trading leveraged ETF ($DUST). Personally at around 20% gain so far in the trade.
I plan to take profits on the entire DUST position soon since GDX is getting close to oversold levels. Probably has a few more days of selling to go based on today’s heavy downward momentum.
Maintain overall bearish view of gold miners as long as there is a lack of negative macro news flow to boost gold prices. I’ll be updating this post daily in case general market sentiment start reversing from positive to negative, check this post regularly if you want to get a head start on trading the reversal!
You can try to scalp the bounce off the support once GDX is oversold, but don’t over-commit because it’s hard to precisely say how much it’ll bounce.
Trade ist aktiv:
If prices are trading in a doji pattern by closing time, I would take 50% profits. Reason being that it's touching the oversold level and a doji pattern signals that there's buyers at this level to support prices.
I would keep 50% of holdings because overall bearish thesis remains, given today's positive corporate earnings and improved market sentiment. Plus a strong USD momentum upwards to break through its upper resistance. Prices have also not fallen enough to get to the previous support.
I would keep 50% of holdings because overall bearish thesis remains, given today's positive corporate earnings and improved market sentiment. Plus a strong USD momentum upwards to break through its upper resistance. Prices have also not fallen enough to get to the previous support.
Trade ist aktiv:
Ended the day on a doji candle, took 50% of profits as I said earlier. Look for more short entries if it retraces tomorrow. Maintain an overall bearish view, see reasons below.
Positive catalysts for gold:
1.) Inflation picks up and surprises to the upside, causing the Fed to consider raising rates.
2.) Brexit uncertainty doesn’t get resolved and continues to make negative headlines.
3.) Negative economic data coming out of the US and China
4.) Negative trade deal news
Negative catalysts for gold:
1.) Positive corporate earnings in the US market. Highly likely due to the low expectations that resulted from the 2018 sell off fears.
2.) Inflation stays relatively stable with moderate growth. Calming the Fed and increases the chance of them keeping their word of not raising rates this year.
3.) Continued US dollar strength on the back of rising US economic projections.
4.) Increased market sentiment towards risky stocks and a further move away from safe haven assets like gold.
5.) Continued positive economic data
6.) Potential signing of the US-China trade deal.
As you can see, the short to medium term outlook for gold is not looking very supportive. .
Positive catalysts for gold:
1.) Inflation picks up and surprises to the upside, causing the Fed to consider raising rates.
2.) Brexit uncertainty doesn’t get resolved and continues to make negative headlines.
3.) Negative economic data coming out of the US and China
4.) Negative trade deal news
Negative catalysts for gold:
1.) Positive corporate earnings in the US market. Highly likely due to the low expectations that resulted from the 2018 sell off fears.
2.) Inflation stays relatively stable with moderate growth. Calming the Fed and increases the chance of them keeping their word of not raising rates this year.
3.) Continued US dollar strength on the back of rising US economic projections.
4.) Increased market sentiment towards risky stocks and a further move away from safe haven assets like gold.
5.) Continued positive economic data
6.) Potential signing of the US-China trade deal.
As you can see, the short to medium term outlook for gold is not looking very supportive. .
Trade ist aktiv:
Miners continue to sell off in the morning session, look to take profits as it gets closer to the support zone. Would not recommending adding more currently as the risk/reward is not optimal.
Here's a few catalysts to watch out for:
1.) Jobless claims data releasing tomorrow
2.) GDP data on Friday
3.) Inflation data on Monday
4.) NEM reporting earnings tomorrow, and GOLD reporting on May 8
If inflation picks up, investors may speculate the Fed will increase rates and gold might get a relief rally. It's also likely that the miners will report earnings surprises to the upside, therefore getting a small rally as well, given that gold prices have found a temporary support. Thesis is still bearish for gold but these short term factors may present a better short entry opportunity.
Here's a few catalysts to watch out for:
1.) Jobless claims data releasing tomorrow
2.) GDP data on Friday
3.) Inflation data on Monday
4.) NEM reporting earnings tomorrow, and GOLD reporting on May 8
If inflation picks up, investors may speculate the Fed will increase rates and gold might get a relief rally. It's also likely that the miners will report earnings surprises to the upside, therefore getting a small rally as well, given that gold prices have found a temporary support. Thesis is still bearish for gold but these short term factors may present a better short entry opportunity.
Trade ist aktiv:
Miners bounced off today's lows and rally hard during lunch time, and eventually settling down a bit by close. This confirms that our strategy to take 50% profits yesterday when a doji pattern was printing by market close.
The rally today provided a great opportunity to add back some short position, I personally added 10% of full position.
The rally today provided a great opportunity to add back some short position, I personally added 10% of full position.
Trade geschlossen: Ziel wurde erreicht:
Take profit from full short position as gold is showing buying pressure despite strong us dollar and rising yields today.
Kommentar:
Will wait until tomorrow GDP data is out to figure out the next trade. I feel that the trend direction is unclear right now.
