I was thinking of making this post a video, but I recognize that the problem with videos is that you actually have to watch the damned thing. Text and pictures are more accessible. So, here we are.
October has, in the five trading days we’ve experienced so far, been a big disappointment for me. I guess I should have assumed it would be, coming on the heels of a fantastic Q3 (both for my portfolio and for Slope in general). Everything goes in cycles. I’m just too much of a brat to be able to tolerate this kind of thing.
I received an email today that I found somewhat troubling, and it compelled me to write this post. In the email, the reader was concerned that, in spite of my bravado declared in this weekend’s Sell and Hold post, I had (on Friday and today, that is, Monday) covered a meaningful number of my shorts and had partially retreated. She felt it wasn’t very “transparent” to state, on the one hand, that I hoped to hold onto positions for months, and yet on the other, beat a quick path to the Exit door the moment trouble arrived.
I think it would be beneficial for me to explain my style and method to help reconcile those two realities cited above, because I’m comfortable living with the paradox, and I want readers to know that I’m being forthright with them.
Here again is our representation of what a positive macro environment would look like for a bullish gold and gold mining stance. We created this theme in July for NFTRH 353.
This view comes off as repugnant to much of the gold “community”, but I cannot stress strongly enough how important it is to tune out the fairy stories about missing COMEX gold (and silver), love-inspired demand from China and India, ‘rising US employment drives interest rates, incentivizes banks to lend and creates inflation, driving people into gold and gold stocks’ or any other angle out there that does not focus on declining confidence in policy making and its ability to control economies and financial markets. Every single one of these supposed fundamentals have already been proven wrong.
We have been using the Tinder Box theme in NFTRH lately. As in, stock market sentiment is so bleak, so depressed as to be a Tinder Box with the elements to ignite a flame that bounces the market, to clear the over bearishness at least.
We have successfully followed a plan every step of the way… 1. down from the August breakdown, 2. up on the bounce to SPX 1975 or 2040 (hit 2020) and now 3. down to a test of the October 2014 / August 2015 lows, which is a decision point between a bounce or an entry into a bear market (by making a lower low to October 2014).
I wanted to share some thoughts on a topic not directly related to trading. I don’t want to take credit for something I didn’t conjure up, since the late Dr. Wayne Dyer originally put the thought in my head, but it has been a persistent notion for me that I would like to share. It’s called the IFD syndrome.
Dyer described it as “the psychology of tomorrow”, and in my experience, it’s something a lot of people practice. Let’s face it, life isn’t easy, and a lot of people need something to look forward to in order to get through each day. I’ve heard it from friends all my life: about a forthcoming vacation, or a prospective promotion, or maybe a new car they’re expecting (that never seems to materialize). “I need something to look forward to.”
On my Tastytrade show recently, I’ve been mentioning how I believe the bears have “the wind at their backs” now. I pondered to myself what precisely what I meant by that phrase, and I wanted to share some thoughts on where my head is at on this topic.
From March 2009 through December 2014, the bulls had the wind at their backs. Early on, it was a full-on gale-force hurricane, provided by the $18 trillion of freshly-minted, asset-inflating “money” provided by the helpful central banks of (a) China (b) Europe (c) Japan (d) the good old US of A.