You Can Lead A Horse To Water -- But, You Can't Make 'Em Drink:
I am sitting at my keyboard while gazing out my window as the locals walk along the sun drenched beach. The sky is clear and blue, the sun warm and golden. I have my patio doors open and a gentle breeze is drifting in across the emerald green waters...
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The irony is that when I wrote that this afternoon, I was not in South Florida, or the Bahamma's... but along the Southern Shore of Lake Michigan,in the quaint Village of New Buffalo, Michigan ...with mid/upper 50 degree temps on a beautiful sunny day in mid-January -- during the dead of Winter.
Given that Pigs get Fat, but Hogs get Slaughtered...and also as there surely aren't too many more Bahammaian-esque days left in January here in the Midwest... twas' time to cover and bank some Nat Gas Shorts.
Natural Gas is down -40% in a month....from $15.50ish to $9 bucks....whodathunkit ?
For traders - that is equal to a $220 move in Gold....but yet, hardly a word amongst the SI cognescenti on Shorting Nat Gas ?
I don't know what more I could have said - as Natural Gas had clearly become a classic disconnect between price & risk (on the short-side)... especially so -- given the mild winter forecasts for the Nat Gas dependant Midwest.
I mentioned this trade setting up back in late September -- after "blowing my gold trade" (vbg):
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Sept 28th, 2005:
Message 21746438
["...Relative Patience... I'm getting an eeriely familar Deja-Vu all over again feeling about Natural Gas - in comparison to the environment that existed at the end of 2000 - into early 2001 during the California Blackout Crisis ... the last time Nat Gas went parabolic....and I made a bundle shorting it.
When, not if... I truly believe (hell, I feel it in my bones already) that there is going to be a Portfolio Weighted Short-Trade in Natural Gas developing for me once again...
I was able to bank a very nice Short-Trade this Spring and caught the initial part of another nice downtrend just prior to Katrina...which quickly brought that to an end.
Timewise...the ultimate Cyclical Top to me looks to be potentially playing out seasonally just as the 2000/2001 Bubble did.... with a mid-heating season/late December potential peak.
Patience... when, not if - Going 'SHORT' NATURAL GAS will be a HUGE Winner.... H-U-G-E.
For now, Cash, Palladium & Silver... along with a much smaller mixed bag of both some miscellaneous long & short plays and perhaps most importantly PATIENCE are my chosen path..."]
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After cashing out my final goldshares on Sept. 16th - ie: "having something else to buy"
Message 21708635
Here's how my "terrible gold call" and rotation into Silver and Palladium have performed from that day forward:
PS: for anyone who is still dealing in reality versus blowing hot air up each others isofullofit arses...
Gold would have had to move thru $720+ to equal the move that Palladium has had off of it's $170-$190's lows:
re: the Palladium Trade:
Equal, or Better Gains - at Far Less Risk !
stockcharts.com[l,a]daclynay[d20050916,20060112][pf][iut]&pref=G
Silver hasn't done too badly either...and rember gold is within $250, or 45% of it's 1980 all-time $800 high...while Silver -- (which has virtually always outperformed Gold in the final stages of the PM cycle) has another $41, or a staggering +450% move to reach it's former highs of $50.
stockcharts.com[l,a]daclynay[d20050916,20060112][pf][iut]&pref=G
Given Silver's historic outperformace of Gold...why would "anyone" -- want to overweight, or even own gold over silver into the maturation/peak of any PM cycle ?
...I asked that very question a couple of months ago.
PS: There's a reason why Warren Buffett and Bill Gates own Silver instead of Gold... and if you don't know why...you need to do a little research.
While Silver is the superior "speculative" vehicle late cycle... occassionally... a contrarian trade far, far superior given "RISK:REWARD METRIC'S" develops... and on any risk:reward metric -- NO OTHER COMMODITY TRADE IN THIS CYCLE -- has possessed superior risk:reward & deep value characteristic's than the recent historic bottom that Palladium has made -- also into a max divergence to it's competitive-sister Platinum.
I've spent the last few months leading others into Palladium...Silver & Short Nat Gas...they haven't done too badly...and it surely wasn't for "FREE"...
Stillwater/SWC up + 50%
stockcharts.com[l,a]daclynay[d20050916,20060112][pf][iut]&pref=G
North American Palladium/ PAL - now a Double !
stockcharts.com[l,a]daclynay[d20050916,20060112][pf][iut]&pref=G
I think most of us learned long ago - the lessons that our children often reaffirm to us... that anything of value that is given free -- is rarely valued by those who receive it.
Free... now there's a four-letter word.
Here's another -- RISK.
Goldbugs are only up + 30-40 points over the HUI's 2003 highs.
That's nothing much to really be crowing about - given the two year timeframe.
There are trades with equal, or better upside and far, far, far -- less risk.
Find them...
ciao` |
