The HUI index is an excellent barometer of the rising and falling sentiment in the mining sector, that can be a key to the placing your trades at the most expeditious moments.
Following the herd cam be a killer to your portfolio when everyone is on the same side of the trade and sentiment is unanimous about direction. It might be possible to ride a trend for a short period of time and make some profits, but most people will get greedy and let it ride because they do not see the writing on the wall.
Trust me, trends always change direction. and you want to be ahead of the curve and be prepared for the change. Most of big profits happen when the trend changes and you are properly invested for the 5-7 days when the biggest swing happens, In fact, you can safely be in cash most of the time, and only invest for the few days after sentiment hits a peak or valley.
Based on my assessment of the HUI index, you can see that my two key indicators have flipped, and we appear to be at the tipping point for initiating a successful short trade in the miners right now, The Parabolic Stop and Reverse indicator (PSAR) has flipped, and the Linear Regression Curve (LRC) has peaked and has started rolling over. Additionally, the 5-10 day MA's are also confirming a trend shift.
Following the herd cam be a killer to your portfolio when everyone is on the same side of the trade and sentiment is unanimous about direction. It might be possible to ride a trend for a short period of time and make some profits, but most people will get greedy and let it ride because they do not see the writing on the wall.
Trust me, trends always change direction. and you want to be ahead of the curve and be prepared for the change. Most of big profits happen when the trend changes and you are properly invested for the 5-7 days when the biggest swing happens, In fact, you can safely be in cash most of the time, and only invest for the few days after sentiment hits a peak or valley.
Based on my assessment of the HUI index, you can see that my two key indicators have flipped, and we appear to be at the tipping point for initiating a successful short trade in the miners right now, The Parabolic Stop and Reverse indicator (PSAR) has flipped, and the Linear Regression Curve (LRC) has peaked and has started rolling over. Additionally, the 5-10 day MA's are also confirming a trend shift.
Comment:
Bear in mind that this next downtrend should result in the capitulation of many of the weak bag holders who have prematurely jumped on the PM train. After these weak hands are washed out, then Gold and Silver should be set for an extended run up that should last for 2-3 months.
Comment:
PSAR has flipped on every miner that I have looked at....Time to exit and sit on the sidelines for a few weeks, or Short the miners if you are brave. pattern
Comment:
In spite of the spike higher in Gold / Silver on today's Non-Farm Payroll numbers, the miners continue to exhibit overall weakness.
Comment:
Weakness in the miners is accelerating now that the Fed Rate hike was confirmed on Wednesday. Expecting a continuation of the downtrend for the next 2-3 weeks.
Comment:
In the past few weeks we have seen some consolidation in the miners with gold now closing below the intermediate trend line that began last December. I am expecting the miners decline to accelerate through to the end of July where they will likely bottom out at the next FOMC Meeting.