The HUI/Gold Ratio
posted Feb 23, 2005 at 09:57PM
Until this triangle gets resolved one way or another I am loathe to make authouritative, declarative statements of where the gold sector is going.
While in this condition, good trading practices trump technical analysis
What do I mean by good trading practices? It means thinking good entry point, confirming good bid support. It means trying to buy bounces off price support channels or symmetrical triangle break-outs. It means making sure your positions are in proportion to daily liquidity.
It means taking the time that your stock has no red herring issues, like dilutive private placements coming up, or labour disputes or balance sheet problems. It means thinking stop-loss in case the deflation scare scenario raises its head.
It could be that because I am up to my eyeballs in home rennovations - (because of demographics and temperment I am sure that I am the last able bodied male to finally enter this arena - thus I am positive the housing market is going to crash within the next few months)- but I am not in the mood for swing trading which takes a lot of time and cyborg like focus. Right now when I buy a stock I want to do so with a more buy and hold sentiment.
For myself I remain holding my gold, my energies and my uranium plays. I am holding 75% cash. (I almost always have at least 50% cash. The last time I was 100% invested was when gold was $255). In this circumstance I am more inclined to take on new positions as older ones rise.
The only thing I feel assured of, is that the US or Israel will bomb Iran within the next six months and the slow motion wreck that is Neo-Conservative America continues apace.