re: Why aren't SI Gold Traders "all" SHORT - NovaGold/NG ?!?!?!
I am a bit surprised that the SI "active Gold Trader Community" - completely and totally missed a HIGH REWARD-low risk...Silver Platter Trade here....and most importantly - WHY is was such a trade.
See this Chart:
finance.yahoo.com
It's because of this:
biz.yahoo.com
The minute the whispers were confirmed - 2 things should have been done.
Sell all NG & GO SHORT (and/or sell some Puts- although little, if any liquidity exists in NG's options).
First; Nova Gold is an excellent company, with stellar assets.
But...we are talking about "TRADING" the STOCK, not the COMPANY.
These Convertible Deals - ALWAYS get shorted - always.
....did I say - ALWAYS ?
Let me repeat it... just in case anyone didn't hear it, or understand it:
A-L-W-A-Y-S.
...this is literally a FREE MONEY "trade."
- or as close to riskless free money as a trade can be.
WE all will be able to buy Nova Gold back cheaper again (hopefully after pocketing 5 to 7.5 million shares worth of short profits and minus potential Put Sale Premiums if you can find any liquidity)....but, this is as easy of a 10-15% in & out Trade as is ever offered.
That FUNDAMENTAL 5 M+ish Million Share Number should be factored into the TECHNICAL monitoring of the trade.
On the Toronto Exchange:
Avg Volume is 93,000.
Recently for NG.to:
Date....... Price..............Volume...Close.
23-Jun-05 9.50 9.84 9.50 9.59 215,800 9.59
22-Jun-05 9.89 9.89 9.40 9.59 273,700 9.59
21-Jun-05 10.01 10.01 9.78 9.80 944,900 9.80
20-Jun-05 10.55 10.80 10.17 10.37 181,100 10.37
Last 4 trading days on the Toronto Exchange = 1.61 Million Shares traded vs 372,000 normal Volume....+1.2 Million above the norm.
1.2 M is not 5 M.
NG.to trading at 9.35 today = down approx - 10% in 4/5 days.
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In the US for NG:
Average volume is 179,400.
Volume over the last 4 days was 2.33 Million versus a norm of 716,000.
NG at 7.59 today on yet again, higher than avg volume & is a - 10% profit on the Short side....with approx +1.4 Million Shares over avg Trading Volume.
Date Open High Low Close Volume Adj Close*
23-Jun-05 7.80 8.00 7.75 7.78 490,000 7.78
22-Jun-05 7.94 7.94 7.60 7.75 514,800 7.75
21-Jun-05 8.40 8.40 7.95 7.97 1,026,800 7.97
20-Jun-05 8.80 8.81 8.24 8.44 299,500 8.44
A High Reward/low risk...short, sweet & simple trade is to be targeting $7-$6.75, even perhaps $6.50ish for a 10-15-20% trade and keep moving stops down - maybe $7.65ish here...and on down towards $7 if the shares keep getting shorted.
Ride the downward Mo... be mindfull of the 5 Mill Share amount of the Convert...and trade this one technically.
10% in a couple days...and should be more to come.
Use "mental" stops - don't get greedy...take what the market gives you...and own the STOCK in a great COMPANY - much cheaper....and potentially get PAID +10-15-20% for doing so.
$eize the opportunity,
...running Silent, but running DEEPly Profitable....a GREAT TRADING Environment for Active Gold Traders here ...Ka-Ching.
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