GOLD SILVER AND ENERGY STOCKS

Gold, Silver, and Energy stocks have been bottoming and some have begun adding nice %-Gains already. I had warned that if we didn’t take a position, it might get very hard to do so. Why?  We might see what is known as an Island Bottom. A Gap open higher that may not fill.  I used this chart yesterday to point that possibility out.

Lets review some charts of Gold, Silver, and Energy stocks for potential entries…

First note that OIL isnt running higher yet, but it is likely about to do so.  Many ENERGY stocks are bottoming.  With that in mind, you may even want to prepare to trade OIL ahead of that reversal.

Here are just a couple of OIL/ENERGY stocks that ran well on the last leg higher this spring.  Let me mention this-  some are already above their 10sma and that was the buy, but one could buy 1/2 of a position here and add if it drops to test the 10sma,  or add after it runs higher and has an initial pullback.

OAS- Notice how it ran higher slowly in March after regaining the 10sma.  Oil is still dropping and OAS is breaking higher and holding the 10sma. Yesterdays drop & tag of the 10sma was a good buy, but it can be bought here too.

REXX –  Ran very well on the leg higher last spring. 100% gains.

EXXI – yesterdays pause may allow some to take a position

LGCY – This had a strong run higher last spring, 100% gains in weeks also.

Please look at these 4 above charts.  Did they run straight up last spring or did they pop & drop & stair -step higher?  That’s why you may just want to take a partial position in a few stocks, and add on any dips or sideways moves to the 10sma.  Remember also that the springtime run higher turned out to be a temporary bear mkt rally.  Some may want to go in heavier and just try to scalp some profits as price rises.

GOLD – Gold looks to have bottomed and it now moving higher .  Miners were leading the move and some are up nicely already.

Since I am expecting that we see a rally for the next few weeks, lets look at some Gold & Silver stocks that may offer some gains as they move higher.    NOTE:  Some people like stronger stocks that are already proving themselves.  They like to buy a stock that already moved up and is showing strength.   This makes sense, but remember that you may enter as it is ready to pullback. It’s a catch 22.   One could use a starter position in a few stocks and add on the dips if they pullback.  I like to go in heavy at the lows, and sell some on the way up, maybe trad the top of the 1st daily cycle or  in the 2nd daily cycle.  Lets look at charts and I will discuss this further on as we go.

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SA- By now you have seen this move off of the bottom.  SA  is up over 70% already, so it is showing strength ( or short covering) , but I cant recommend buying it here.  Entering here may be fine, but also you could get a 50% retrace of this entire move and the stock would be fine. THIS is an example of the potential in some of these miners.

Lets look at some Miners that haven’t moved so much higher, in the event that they play catch up.  You may want to own your own basket of stocks, since Piling all into 1 stock is dangerous! I also have juggled them in the past,  buying a couple and when they get extended,  I lock in gains and enter others that are good set ups , but lagging a bit.

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FSM – Silver stock putting in a double bottom. Yesterdays report had this as a buy.

Update: Still here  🙂   tested the 10sma.  Buy.

Yesterdays report had these also …

SVM – Silver stock buy yesterday

Update, still a buy

AU – was a much loved and familiar miner for yrs. I cannot believe we had it under $6!

AUY – even a small bounce to the 50% area & resistance could net 50%  From Here. 

PAAS– Silver miner. Again,  I’d add partial to have some skin in the game, and add again if it dips.

BTG – If you saw this set up Monday,  it didnt look like much.  It was  just breaking above the 10sma.  It was lagging.  SEE how quickly that changes? That is why I am pointing out laggers.

AG – I love this silver stock, I like the management, but it is a lagger at this point. It will likely play catch up.

Lets have a mini lesson on the potential opportunities we are looking at.

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NGD–  this stock is Just Getting Going. Think about this- this stock was under $2 last week.  This tiny move higher already added almost 20% in 3 days.   What would a small pop to $3 do? It would add 40+% gains.

Now look at NGD WKLY.  A tiny pop to $3 is very possible.  A break out & run higher would be amazing.

Ok, back to more set ups.

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DO I care that CDE is lagging? No, it may be heavily shorted and may have a nice short covering rally to help it catch up.  It ran up over 100% last time.

CDE – nice run from the Nov ICL. Not straight up, so lets all be prepared for a bump ride.

HMY –  just leaving the bottom.  It has visible resistance, but some of these can move right through it.

There are many more miners out there that are moving higher or just getting going.  This list is to show you the potential and the need to be in it to win it.

There is a thing known as   “Afraid To Trade“.  Some dont want to buy at lows, but when we move off of the bottom, they dont want to ‘chase them’.  There is no cure for this thinking except to take a small partial position .   Yes, some are up  10-15% already, but some will move 100% off of these lows. Why not just grab 30% for yourself and then sell? 🙂  Start a few small positions on some that haven’t taken off yet,  get a mini -basket going.    You have to be in it to win it.  I have been discussing ‘a great trading opportunity in Metals this summer’ since last spring, to mentally prepare us for this time . That Summer rally appears to be starting, and we can use stops to prevent large losses.

REMINDER-  Gold was up over $10, but is falling as I write. Will we get a Gap Open in Miners?  So far GDX is only up 13 cents pre-market.  Not a big gap.  However,  I mentioned this possibility well over a week ago and reminded us yesterday.  These GAPS higher do not have to fill if they gap & run.

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  An ISLAND BOTTOM

Look familiar? Time will tell. my sideways indicators triggered their buy yesterday as reported in my mid day alert.

Best wishes to all. I’ve been talking about this opportunity since the spring time and following it step by step. At this point we may rally for several weeks and then when sentiment gets really bullish in Metals again? We may do a final drop to sub $1000, and our falling stock market may have its 10% correction in place and begin to rally again.  I can picture a few scenarios, but lets take it a step at a time and make some money in Miners and maybe even Energy at this time.

~ALEX