Hmmm, not sure why that last one posted twice...
Anyway I just wanted to check in with a couple of comments. I think the pool of investors playing resource juniors is very small, and basically the same group are buying and selling to each other. We saw PM juniors get very hot last year. Over the summer uranium was the story. Now coal seems to be the flavour of the month. I expect that silver will get its turn early in 2005 if the POS breaks the $10 barrier. All of these groups are very small with limited choices for fast money to find a home. Momo traders are basicaly get into these early and then during the distribution phase unloading their shares on the retail buyers that show up late for the party. The quality of the companies involved seems to be unimportant for the run up, but it matters a great deal if you are the one holding the bag when it is over. What will bail everyone out is if the number of investors willing to play these stocks increases, ie. the broader market shows up. It wasnt until the average joe-6pack bought into tech companies that the Naz bubble realy got started. Typically these guys show up in the last third of any major move, so we may have another year before the stocks can take off and make sustainable gains.
I have tried to stay away from the spec plays that do not meet specific criteria that ensures I can wait it out if I do end up buying high during this pre-bubble phase. Sometimes that means I miss a move. Also I have been very patient holding onto companies like IAU and ER that are well under water from my buy-in levels, because I think they could go parabolic on short notice just as so many others that have been discussed on this forum. (By the way I have received a cash payment from ER to put their link on my website, just to ensure my personal position is fully disclosed on that one).
When the POG starts to rise in other currencies, then its game on for the PM sector. Until then I suppose there is money to be made playing the flavour of the month, but I do not confuse this with a real bull market. Not yet anyway.
Howy are we still on for the gold at $450 party? I think we should book that now that its official. :-)
We havent had a legitimate whacking day for several weeks, but I have noticed that Mondays and Tuesday stink most of the time, Wednesdays are fairly neutral, and Thursdays and Fridays are the best days for gold stocks. With that in mind I hope to be a buyer on Wednesday to catch the lows because with the dollar up slightly overseas tonight, and gold trading down, we may have the setup for the long awaited counterattack in the sector. I do think this one will be short and will be the trigger to finally get some more of the money back in that has been sitting on the sidelines waiting for their buying opp.
cheers!
COACH247 |
