Roll With The Punches

It’s been a rough week and I can sense the exhaustion here and in various waterholes I’ve been poking my nose in lately. Unfortunately there’s really nothing to be done here but remain patient, emotionally balanced, and vigilant. Patient in respect to lasting through what has effectively been a year long sideways market (with a quick downside correction mid year), emotionally balanced in the context of our own participation, and vigilant as to not miss out on a juicy entry opportunity when it occasionally represents itself. All in all we have done extremely well this year and surviving this mess means means we have been sufficiently battle hardened to take advantage of whatever comes next. As the saying goes – to the victor belong the spoils 

The Euro is dropping like a rock right now which does wonders for my Dollar exchange rate but technically speaking it’s actually a major break down after coiling up for months. The LT charts above put things into perspective quite nicely. A possible target range here is the 1.06 mark, of course barring any sudden surprise announcement courtesy of our Fed. As with everything we are rolling with the punches here…

Quick update on gold which has corrected lower and remains to be a great entry here. On the stop side I’d be extra conservative and remember that this affects your position sizing.

Silver is actually looking a bit more ambivalent and it’s possible that it’s our canary in the coalmine on the precious metals side. Obviously it’s pinched to the max on a short term basis and I’ve said on several occasions that a drop to SI 17 would have been a much better entry opportunity. Which incidentally also spells true for gold where I was hoping for a touch of GC 1240 (Dec contract).

The rolling with the punches analogy also holds true here. If you look at the price action on the daily panel of the silver chart then you’ll realize that some of my technical boundaries were barely grazed or that a reversal happened prior to a full retest. Which once again shows us that no market lens is perfect – in the end only price is the ultimate arbiter of truth. It’s possible that the lows are in on both the gold and silver side. But we can’t get married to that idea and accept it if a deeper slide represents itself. Should that happen then new and even more promising entry opportunities will represent themselves before the end of this year.

Alright, it is Friday and you know where to find me next. Suffice to say that I’m in dire need of an extra helping today as it’s been a particularly tough week for me. Not only have the markets been crap, I haven’t been feeling/sleeping well plus the weather here in VLC has been grey and rainy. And on top of that we have been enduring the head splitting pounding of jackhammers right in our street all week starting early in the morning. My head is ready to explode and I am in dire need of a professionally brewed medicinal aid of the Bavarian kind.

Prost!