Tuesday 13 December 2016
A great opportunity setting up: Uranium
As of today, the price of Uranium is going for 18 dollars a pound. This will result in a huge opportunity in the next couple of years. The average cost to product Uranium is about 31 dollars on average. The numbers present a huge loss for producers, and I believe the lowest cost Uranium producer in north america can produce it for about 22 dollars so everyone is taking a loss at these levels. This will cause mine closures which will cause the supply coming to the market to shrink. This will not have immediate effect because there is still an over supply on the market which is the reason for the price falling in the first place. Marin Katusa, who is a very smart guy in the resource sector when it comes to investments, says the over supply will last 6-18 months. I haven't done the math on this myself but I trust his is accurate. What this means when the over supply has been used up, we will see a nice rally in the price of uranium. I'm not sure what it will go to, but I know that the beat up companies in this sector will rally greatly. Profits will be made if you put your money in the right companies. I have not yet invested, but I will be entering a position starting in 2017 so I can position myself for possible gains. My belief is you could see 200% gains or more if your in the right company's. I personally am looking at UEC at the moment, but do your on research because these are risky plays and you can lose a huge amount, or all of your investment. There is great risk involved in these trades always.
Monday 10 October 2016
Update on the markets
Last week, gold had a nice drop. It broke its support line of the 1305 area which triggers the stop loss which is the reason for such a dramatic fall in price. I was being careful of this level being broken, and as I saw it break, I was hitting the sell button on all my mining shares. I sold them for a loss compared to the day before, but still closed profits about 150% roughly year to date. I managed to buy back the majority of them all below what I sold them for, and now I currently wait to see how this will play out. The support of 1305 range will become a resistance now, so we could see gold go up as high as that on a bounce. The bottom is 1242, so that level will be support, if it breaks that level, Ill most likely sell my shares again, On the shorter term, it is a bit more trickier to predict where the markets go, but on a longer term, I could imagine silver and gold go up. I am still cautious about the precious metals though. Deflation is overpowering inflation it would seem, which could bring down the metals. This would provide a fantastic buying opportunity, but perhaps if this plays out, wait for the massive printing to be started as a central bank guarantee to make gold prices higher.
The stock market is hovering still near all time highs, which is a bit of a surprise to me. I expected the markets to crash this year, which is still possible but I did not think about it being election year. I strongly believe shortly after the election, the stock market is going to plunge, but until then, the plunge protection team I'm sure is hard at work. That could be the reason for such the tight trading range lately. If Hillary wins, the market could have one last rally after the elections. If Trump wins, I'd imagine the market drops sharply on the day. It would seem more likely Hillary will win, but It seems like the media is trying to deny how big of a group trumps followers are. I do not know who will win, but I assure you the market will tank by the end of there term, and money printing never seen before will be started, unless the winner is Trump. I'd imagine he would not allow the money printing to happen. It would make me unsure of my metals position. If the metals break past its current support, I will wait on the stock market to drop so I can make money shorting that with my profits from the metals. When the trading range stocks are currently trading in break out, you will be able to tell if you should go long or to short.
Crude oil today looks like its breaking out of the 50 dollar level. This could be a false break out in the end, but it could be a good long position instead. I am not risking my money on this trade. I would feel much more better shorting it if it broke past the 40 level which will happen most likely if this is a false break out. Oil supply and demand are bad and will get worse, as we are most likely in a recession if not heading for one. This has been the third longest economic expansion (and the weakest one) and it is heading towards the second longest expansion quickly. A recession is right around the corner if we are not yet in one. This recession could plunge the price of everything causing deflation if quick action is not taken. If Deutsche bank fails, this could also cause a deflation crash since it would bring down other banks with it. I would imagine world leaders are not dumb enough to let this happen so I would expect them to be bailed out.
Thanks everyone for reading, these are my thoughts on the market. At a time like this, we have to be careful with our money and our investments. The future will be rocky and if the next recession is a crash like 08, these times will most likely be considered the second depression. Good luck to all in the investing field.
Where the markets are heading
Last week, gold had a nice drop. It broke its support line of the 1305 area which triggers the stop loss which is the reason for such a dramatic fall in price. I was being careful of this level being broken, and as I saw it break, I was hitting the sell button on all my mining shares. I sold them for a loss compared to the day before, but still closed profits about 150% roughly year to date. I managed to buy back the majority of them all below what I sold them for, and now I currently wait to see how this will play out. The support of 1305 range will become a resistance now, so we could see gold go up as high as that on a bounce. The bottom is 1242, so that level will be support, if it breaks that level, Ill most likely sell my shares again, On the shorter term, it is a bit more trickier to predict where the markets go, but on a longer term, I could imagine silver and gold go up. I am still cautious about the precious metals though. Deflation is overpowering inflation it would seem, which could bring down the metals. This would provide a fantastic buying opportunity, but perhaps if this plays out, wait for the massive printing to be started as a central bank guarantee to make gold prices higher.
The stock market is hovering still near all time highs, which is a bit of a surprise to me. I expected the markets to crash this year, which is still possible but I did not think about it being election year. I strongly believe shortly after the election, the stock market is going to plunge, but until then, the plunge protection team I'm sure is hard at work. That could be the reason for such the tight trading range lately. If Hillary wins, the market could have one last rally after the elections. If Trump wins, I'd imagine the market drops sharply on the day. It would seem more likely Hillary will win, but It seems like the media is trying to deny how big of a group trumps followers are. I do not know who will win, but I assure you the market will tank by the end of there term, and money printing never seen before will be started, unless the winner is Trump. I'd imagine he would not allow the money printing to happen. It would make me unsure of my metals position. If the metals break past its current support, I will wait on the stock market to drop so I can make money shorting that with my profits from the metals. When the trading range stocks are currently trading in break out, you will be able to tell if you should go long or to short.
Crude oil today looks like its breaking out of the 50 dollar level. This could be a false break out in the end, but it could be a good long position instead. I am not risking my money on this trade. I would feel much more better shorting it if it broke past the 40 level which will happen most likely if this is a false break out. Oil supply and demand are bad and will get worse, as we are most likely in a recession if not heading for one. This has been the third longest economic expansion (and the weakest one) and it is heading towards the second longest expansion quickly. A recession is right around the corner if we are not yet in one. This recession could plunge the price of everything causing deflation if quick action is not taken. If Deutsche bank fails, this could also cause a deflation crash since it would bring down other banks with it. I would imagine world leaders are not dumb enough to let this happen so I would expect them to be bailed out.
Thanks everyone for reading, these are my thoughts on the market. At a time like this, we have to be careful with our money and our investments. The future will be rocky and if the next recession is a crash like 08, these times will most likely be considered the second depression. Good luck to all in the investing field.
Thursday 22 September 2016
Is gold a better investment than silver?
The gold bull market of this year, has brought a lot of attention to the sector. If you are new to this sector, you may be wondering which metal to buy, silver or gold? It is good to own both in my opinion, but I believe it makes more sense to have more silver than gold by a lot. Perhaps every 8 dollars you have in silver, you should have 2 in gold or around that range. The reason why I believe this is because the silver price moves a higher percentage than gold. If you like safety more, and don't need the extra reward, than gold is a better play. There is risk with owning more silver than gold. When silver goes up, it out performs gold in percentage but also when it drops, it also drops a bigger percentage so it all depends on if you believe this gold and silver bull market is here to stay or if its just a bear market rally. Both are possible, and both you can profit from. I myself like high risk, especially in this sector where its been beaten up so bad. Silver has gone up around 44% YTD while gold is up around 27% YTD roughly. There is one example of how silver out performs gold. If you want to take a look at the risk of a down fall, from the 2011 top to 2015 bottom, silver dropped about 70% while gold dropped closer to 45%, doing the numbers in my head so they may not be exact but close to. That is the extra risk involved in silver. It is possible the metals could drop lower, but assuming this happens, I would have to bet real estate would drop by 50-80% and so would the stock market. If this happens, the only safe play is physical cash since banks would be going under. This would offer tremendous opportunity though as well so be prepared if that does happen but my belief is the federal reserve and all the other central banks will print trillions to stop this. The government would go bankrupt if this were to happen since they would receive less tax dollars, they would default on the debt. They have to inflate rather than deflate in order to keep our current system going, which should change sometime in the coming years. When, I do not know but it is coming one day. You now know the leverage you can use through silver, there is even greater leverage using the mining shares, which of course come with an even greater risk since an individual company can go bankrupt at any time for a number of reasons which we can't predict. While silver is up 44% YTD, mining companies are up in between 100% and 500%! Thats incredible leverage, but of course that's not for everyone. The current pull back in the mining shares sector almost scared me enough to get me out of my positions watching my portfolio go down 37% roughly from its peak. It offers incredible leverage but its hard to be at peace every second the market is opened. You have to have a strong stomach for this leverage. They also dropped about 90% or more from there 2011 peaks. A lot of companies went bankrupt.
I would not recommend buying or selling, as the future is still unpredictable, but get educated so you can take advantage on upcoming opportunities. Thank you for reading, and wish you the best investing.
I would not recommend buying or selling, as the future is still unpredictable, but get educated so you can take advantage on upcoming opportunities. Thank you for reading, and wish you the best investing.
Wednesday 21 September 2016
Is it time to buy gold?
Gold has shown great returns leaving everyone with a great question. Is it time to buy or time to sell. Daily, I have been getting worried and ready to press the sell button watching gold go near its support level down around 1305. I probably would of hit sell if it had gone to 1304! Luckily I didn't and japans central bank was a positive for gold, as well as the fed. No interest rate hike! That is only a short term move for the market I believe though. In order for me to be bullish on gold, we are going to have to get higher in the 1350s level and then break through that high around 1380. This could still be a bear market, and we could be experiencing a bear market rally. Thats what Harry Dent believes, who is a smart guy. He could prove to be incorrect with his deflation theory assuming that the fed printing trillions will not stop this when it comes. He could be right or someone like Jim Rickards could be right with their 10,000 dollar gold which seems more likely but only time will tell. I am still very skeptical of this bull market in gold, but I am heavily positioned to profit from it while being prepared to leave the market the second I believe it is going to reverse its trend to its bear market. I do believe much higher gold prices are going to come possibly up to 2500-3000 range, or higher. Yes higher, it is very likely considering we already know the reaction that central banks will do if they see any signs of deflation, which could be close considering America looks like its already in recession. They will print again and possibly go negative interest rates. I cant imagine gold going down in a negative interest rate environment. The way I view the gold sector is if your in the right stocks, you can only lose 100% of your investment, but there is potential to make 50x your money. Those odds, I like alot. I do believe gold has more room to go but we have a lot of walls to break before its in the clear bullish view so be careful and ready to sell if the market changes.
Thursday 2 June 2016
The big crash
As of today, the major stock indices are close to highs. It must be time to celebrate and buy more for the breakout levels, right? I would disagree. The higher these markets go, the worse the reward to risk ratio gets for investors. I'd be selling into these rallies but I would not suggest to short sell it because there are ways to manipulate the markets upwards as it has been already in my opinion. The earnings for the majority of the stock market has been declining for about a year-two, but stocks have been rising, does that make any sense? The only reason for the prices of these stocks to continue going up is because of the companies buying back stock. These causes the Earnings Per Share to look attractive evening though the actual earnings are decreasing. If earnings are decreasing, they can only continue buying back shares for a limited time which. Mutual funds and hedge funds have been selling more than buying recently, so this should cause the market to go down when these buy backs slow down or stop. Once the previous lows made recently on the stock market get taken out, stocks will only have further to drop. This is when you will know its safe to short sell or buy an inverse ETF to profit from the downfall of the S&P and Dow jones.
Global economies are currently showing weakness, and this is dangerous for investors. China is still in a rut and the U.S looks like it could be following. Europe has negative rates and is printing like crazy to fight deflation. This will be what the U.S will most likely do as well if we start seeing deflationary symptoms pop up again. This is a reason why gold should be a strong buy, the fundamentals for gold are strong, and it would appear an uptrend has start in the gold market. There has been a shift with money flowing into the gold sectors at a very fast pace. Look at the mining shares, all mine have gone up 100-300 percent, and thats from me buying when i noticed the trends were starting. Right now, gold is having a pull back, which is why I am making this blog, to hopefully convince people to decide to get into gold/silver and possibly mining shares as well. Gold is a currency, while mining shares are an investment, and have more risk but even more reward.
If global economies are weakening, we can expect oil to go down lower. Oil is currently at 50, and it can go up still, but I believe this rally is fake. They have shipping large amounts of oil to china to be stored, which takes the concern away from U.S storages being almost full. If U.S storages were to be completely full, imagine how fast the price of oil would drop. Oil is being produced faster then consumed, and thats what spells disaster for the oil prices. This trend has to change before oil can make a bottom. The dollar could get weaker though preventing oil from breaking its low around the 26.50 range. If the dollar gets weaker though, it would create a higher gold price. If you look at gold and the dollar, you can see how one goes up and the other goes down. My thoughts are its more profitable to short the dollar by buying gold then to short oil, and most likely a lot safer. Oil is something I will be investing in when I notice the trends changing for supply and demand.
Real estate value could decline, and most likely will, but this will be a buying opportunity for anyone who is a POSITIVE cash flow investor. Chances are any strong deflation in the economy will be tackled with inflation from helicopter money. I would not buy and hold to flip. My suggestions for anyone who is in mutual funds should sell right away, the risk to reward is terrible. I would also consider holding cash for upcoming opportunities, but Id keep a good position in gold to profit. U.S treasury bonds will most likely go up as a rush of money flies to what people believe is a safe haven, but I would not trust this investment long term. I hope you all take action to profit and be in a position to acquire any opportunities that come up in the future years. We could be seeing something similar to the great depression, but we will see currencies destroyed trying to fight this if this happens, and this is what I believe will be the big crash, and these are my opinions of what asset classes will do.
Tuesday 19 January 2016
Fed rate hike coming up
It is september 20th and we are getting closer to find out if there will be a rate hike or not. My belief is there will be no rate hike but I have a plan for my own portfolio if they do. This year I have been purchasing Gold and Silver mining shares, with the majority of them purchased in the first 4 months of the year. I have seen great returns of around 200% to this day. The problem is if there is a rate hike, that could damage my portfolio greatly or even wipe it out if it creates the current bull market in gold to turn out to be a bear market rally, which is still possible at this time. My plan if this happens is to sell all my mining shares, which I am in 100% for my positions in the market, so I can have all cash and buy back at a later date or short the market. If gold breaks the support level it currently is close to, I will be thinking about selling and buying back at a discount. If the rate hike happens, I will be most likely taking that cash to short this market assuming gold goes down with the market, which it would appear is likely to happen judging by the other week when the fed mentioned hiking rates and it dropped the stock market 400 points, and gold and oil went down for that ride as well. The stock market does show signs for a top at the moment, and when it falls, it will fall fast I assume just as it did the first time they hiked rates. Volatility will be a good play if this happens.
This is how I see the market, and how I plan on playing it. It will be an interesting two days to see what happens with all of the markets. I'm excited to watch, the markets are going to explode one way or another. Thanks for reading.
This is how I see the market, and how I plan on playing it. It will be an interesting two days to see what happens with all of the markets. I'm excited to watch, the markets are going to explode one way or another. Thanks for reading.
2016 and its opportunities
I am starting to believe we may be entering a recession sooner than I had thought. I was believing we would see a recession by the end of this year, or early 2017 but We may be entering a recession right now as some indicators are showing. If we see another interest rate hike from the federal reserve, I believe the dow jones index could drop to 14,000 this year, with oil going down to 20-25, but we are not that far as we currently are at 28.5. This will be an excellent opportunity to make a 50% -100% move when it hits its bottom. The opportunity to make tremendous gains in gold and silver looks like its appearing now as well, as companys producing those metals are dropping like a rock, down 10% on average today alone. I expect oil, metals and stocks will continue to fall until you see the federal reserve print more money (QE4) or them reverse the interest rate hikes. If they don't do one of those two things, we will be entering a great deflationary period that could be worse then then great depression. We are on year 7 since the last recession, and recessions occur every 2-9 years. What bullets do we have when we enter the next recession? They will have to print more money, and that will create our opportunity for tremendous gains in both oil, and precious metals. I have been investing in precious metals myself, but with these deflationary forces we have coming, I am starting to put new investments into the U.S dollar most likely, since my canadian currency is going to continue to fall with oil prices, and holding a cash position will put me in a great spot for any coming opportunities.
Click here to see some charts from Mike Maloney, that point to exactly what I'm saying here.
Click here to see some charts from Mike Maloney, that point to exactly what I'm saying here.
Thursday 7 January 2016
2016 predictions and how to prosper from them
The future of the global markets is volatile. This past week, china's stock market has dropped 7% twice, causing a trading halt for the rest of the trading day. It took 29 minutes of trading to hit this mark today. This caused the dow futures to hit a low of 16,400 roughly, going down about 2.5%, which is about 500 points from 16,900 its previous close. At opening, the bids took the price up a bit higher, and it closed at 16,500. With some countries such as China, and Canada in a recession, you can expect this to cause a chain effect that will drag the U.S into a recession to. Knowing all this, what can we do to stay safe? Americas stock market is most likely to be dragged down along with the rest of the global stock markets, so you don't to be caught in them until valuations of the company's become an excellent opportunity. How do I know that stock prices are going down? Well one reason is the fed is raising interest rates, which slows growth, inflation, and is a measurement used to prevent creating bubbles if certain markets get to hot. We already have low growth. Inflation can be seen in certain places on the economy, such as the stock market, real estate, and food. The federal reserve says inflation is low though, so we can expect them to try to fight that. Since they stopped QE, which is another name for printing money, and interest rates are going up, slowing any growth that we currently have, and a lot of country's are starting to go into recession, this is all deflationary. Baby boomer's also spend less during retirement, which is deflationary and them all pulling money out of their pensions and 401k's in waves, which just started a couple of years ago, will not help the stock market go up either. The stock market has not done anything really in the past 15 years. The risk to reward for anyone in a mutual fund has risk outweighing the reward big time. Dow 10,000 is alot more likely then dow 20,000 unless more money is created which may cause people to lose faith in the dollar if they continue to do that, which will lead to high inflation. The real estate market is going to go down with higher interest rates. Speaking of oil, in my city, a house that sold for 760k just sold for 1.09m after 3.5 years, which is 330k rise, which is pretty much a 45 percent increase. Risk outweighs the reward on that one for sure. Canada's real estate market is a bit too hot for my liking. Positive cash flowing real estate is good still though. Oil still has a bit to go down since we are in a deflationary period. It could go as low as 10 a barrel but I think 20 dollars a barrel is a great opportunity still. So what I think is the place to be is in two things. The american dollar, or silver and gold. The dollar will get stronger as people run to it in economic uncertainty. Silver could go down to 7-8 dollars U.S which is about a 50 percent drop from the price it currently is but at that price, the premiums you pay will be higher than the current price you see today. That is what happened in during the crisis, as silver went down in price, you were still paying 20-30 dollars for silver since the supply was no where to be found. Since the price of silver has already crashed about 70 percent, it has started to slow down production but demand has been continuing to grow. If prices crash to 7-8 dollars, companies are going under, production will crash, and anyone who owns shares of company's that can survive this period, and physical silver will be getting ready to watch their value go up dramatically. I do not know if the ETF SLV will survive though, so I would rather pay a premium to insure myself to have it in my possession. My prediction is silver and gold bottoms in 2016, global recession hits before second quarter of 2017, maybe sooner, and the dollar hits new highs. I believe the stock market will end lower then it started, but I do not know how low it will go. It could make a new high but I'd bet against that by owning silver. I believe we are due for another crash and my guess is something happens after U.S elections. They always push the problem to the next person so they can deal with it. Janet yellen will be cleaning up Bernakes mess and I would assume its after elections if they can hold everything together till then. Why do I feel so bearish to the global economy? The problems that caused the 2008 crisis were never fixed. They just printed money, bailed out corporations, and pushed the problem into the future. It will be interesting to see how the future plays out, Im not even sure if interest rates can continue to rise. The government can't afford its debt if rates start to rise. I could see negative interest rates appear in america, though I would be surprised though to see that. I have learned to expect the unexpected though when it comes to this corrupted system.
Thank you for reading, and I hope you all take action to buy silver and gold, as well as silver and gold mining shares. Add a bit of the US dollar in your portfolio to make it a bit less volatile. The bottoms are coming in this year, if we have not already reached them.
US dollar value:UP
US stocks: down
Silver: down then up.
china: down. Bear ETF
Cash position is good to hold for up coming opportunity
Any money printing or lower interest rates could change these predictions for 2016
Thank you for reading, and I hope you all take action to buy silver and gold, as well as silver and gold mining shares. Add a bit of the US dollar in your portfolio to make it a bit less volatile. The bottoms are coming in this year, if we have not already reached them.
US dollar value:UP
US stocks: down
Silver: down then up.
china: down. Bear ETF
Cash position is good to hold for up coming opportunity
Any money printing or lower interest rates could change these predictions for 2016
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