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The Lunatic Fringe - Trading talk.

Voodoo

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I bought some physical silver last friday and some meme stocks as well as miners. Was getting close to buying some miners yesterday and moved money but may buy those next week. Moving some big chunks in every week now it seems.

I did buy a bunch of a beaten up SPAC yesterday that reported pretty decent earnings. Spac's doing well today. I bought like 1500 of SPIR after earnings. Talk about a manipulated stock price. That one fits the bill.

Speaking of which I really need to keep adding to one of my favorite juniors. Sabina. I did buy 1,000 shares recently and I want to take those DRS but I'm not sure Etrade is gonna let them go easy. I hadn't even seen but they just announced two more drill holes and they are really pretty good grades. And the price is now less than what the mine financing and Sprott bought at. Sign me up.

Results include 13.68 g/t Au over 31.90m,
and 11.93 g/t Au over 41.45m
 

Lancers32

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The real problem is not buying a small dip in a bull market and having it turn into a bear market. If you buy bigger and bigger into a bear market than yea, that's a really good way to see BK (cough Cathy cough). So you Have to be right on the bigger picture. And that's usually where I excel. I do Not follow crowds what so ever and have almost no emotion so I can handle large short-term red numbers.

These manipulative sharp or just deflationary scares in some of these things are great buy opportunities.
I have usually found that if a position is still red after the second day than I was wrong to get in in the first place.
 

gnome

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nasdaq bounces off 30 RSI with a big white candle, but volume not confirming.

Screen Shot 2022-05-13 at 2.07.46 PM.png
 

gnome

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I think there's going to be a bifurcation in tech stocks - profitable companies with strong cash flow like apple, Tesla, nividia will rebound quickly, while the ones losing money or deeply in debt are going to suffer in higher interest rate & recession.
 

Voodoo

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I have usually found that if a position is still red after the second day than I was wrong to get in in the first place.

You're time frame is way shorter than mine then. That video with Rick Rule in the other thread on Uranium gets into his psychology really well. You should WANT a stock that is a good buy to get even cheaper.
 

gnome

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You're time frame is way shorter than mine then. That video with Rick Rule in the other thread on Uranium gets into his psychology really well. You should WANT a stock that is a good buy to get even cheaper.
When I have high conviction, I can feel good about an asset going on sale.
 

jelly

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If this was something else other than gold, would you buy this?
WEEKLY close below the 200 DMA, and below the upper trendline. At this point, this is a failed breakout.

The only positive this week is the big rally Friday in the miners, especially silvers.

gold.png
 

Lancers32

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You're time frame is way shorter than mine then. That video with Rick Rule in the other thread on Uranium gets into his psychology really well. You should WANT a stock that is a good buy to get even cheaper.
Well that depends upon where you own it from and in what size. Give you an example. UEC one of the better performing Uranium stocks that trades a decent volume daily. Topped very recently $6.60 traded down to $2.95 on Thursday. No one knows where any market is going so if you were holding from $6.60 and got halved in a couple of weeks I don't know how you could be happy about that. I don't want any stock that I own to go down after I buy it if I want to buy then sure.
 

Lancers32

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When you buy the dip...


FSqcS3IWUAA7UKk.jpg
 

Lancers32

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How dumb can you be?


 

Lancers32

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Turn 6 months from the high.

BTCUSD_2022-05-14_08-35-06.png
 

Jodster

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Well that depends upon where you own it from and in what size. Give you an example. UEC one of the better performing Uranium stocks that trades a decent volume daily. Topped very recently $6.60 traded down to $2.95 on Thursday. No one knows where any market is going so if you were holding from $6.60 and got halved in a couple of weeks I don't know how you could be happy about that. I don't want any stock that I own to go down after I buy it if I want to buy then sure.
Fair point Lancers but I think if anybody holding a stock sees a dip they may not want to stop out so hastily. I’ve held through crashes and I’ve set stop losses at 5%.
On a short timeline the stops work. In volatile markets holding works because some don’t have the luxury of watching the ticker all day. 50% dips become part of the game. If a stock is strong and there’s no rush, stocks typically rebound 75% in a Bull market and is lazy folks will just wait.
 

Lancers32

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Buy and hold and buy the dips works in bull markets. You never know for sure in real time when the run is over and I never suppose that I know more than the market. I would rather be the victim of a stop hunt than lose a lot of money. Bull markets tend to top on nothing but good news.
Number 1 rule is don't lose money. At least not a lot.
 

Voodoo

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Well that depends upon where you own it from and in what size. Give you an example. UEC one of the better performing Uranium stocks that trades a decent volume daily. Topped very recently $6.60 traded down to $2.95 on Thursday. No one knows where any market is going so if you were holding from $6.60 and got halved in a couple of weeks I don't know how you could be happy about that. I don't want any stock that I own to go down after I buy it if I want to buy then sure.

It's the fundamental difference between an investor and a trader. Eric does the math and knows what a deposit is worth and then he puts a % on the likelihood of it being a mine. So if you have a good idea of somethings value and like the risk/reward at X then the price drops and say it makes the risk/reward even better then you have no problem buying even more.
 

dpong

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Good discussion. I think that most (but not all) disagreements are because the participants have different timeframes in mind. These timeframes often differentiate between investors and traders, but again not always.

So in physical metals I'm an investor and a long term investor at that. Price swings don't phase me in the least.

In the Stock Market and including PM stocks I'm a trader. So yeah, I'm going to try to find a trend, get in that trend, and then using trailing stops to get out. That's a trader. As a trader I certainly enjoy being in the green early on in the trade -- though that doesn't impact the outcome.

As a long-only trend following trader I need the trend to be going higher. If the trend stops going higher and begins going lower I'm on the wrong ship. So I'm out.
 

Uglytruth

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Some excellent comments at link.


Yes, Rates Are STILL Going Higher
[Comments enabled]
Don't be the fool.
We've spent the last nearly forty years, as you can see here, in a generally declining-rate environment.
Let me explain what this means for corporate America.
I borrow $1 million at 13% interest. This costs me $130,000 a year to keep "outstanding." I produce nothing for the next five years and pay the coupon with the $130,000 each year. I've now got $350,000 in cash left (the rest I paid in interest) and I'm very bankrupt since I can't pay the million back -- right?
Wrong.
I roll it over. I don't have to pay the million dollars. It's five years later and the rate is 9%. Now it costs me $90,000 to keep it out, not $130,000. Note that I just bought myself more time, but since the market is "looser" I can borrow a second million. This costs me $180,000 a year to keep out, but, in five more years.... I refinance it again at 5%.
Now I've only got $450,000 in cash left -- remember, I've produced nothing -- but now my "nut" annually is $100 large. Can I get another $2 million? Probably. With which I sit for another five years or so and do it again, and again, and now I am eventually down to a 2% rate on the money.
I'm not out of money. I should have been out of money seven years into this game but I got away with it for close to 40 years. If I produce anything whatsoever with the funds I'm even better off in terms of my credit posture, and I've probably borrowed even more. Not $4 million, probably $20 million.
My stock price, which was $5/share back then, is now $3,000 split-adjusted -- and it has split several times.

All I have to do is convince Wall Street -- or some venture hack -- that he's got something here and since the market keeps running and the cost of borrowing keeps getting cheaper they finance folks will keep letting me do it!
Here's the problem: None of that was ever paid back. None of it can be, because I have no assets that are worth anything and I certainly don't have any money in the bank. If I had assets originally they're 40 years old and likely out of date and worthless. How much is an old open-hearth style blast furnace worth these days? Zero. In fact it probably has negative value because you would have to pay someone to wreck it out and haul it away, likely more than the iron and steel in the unit is worth.
But now those days, my friends, are over.
I pointed this out in Leverage back in 2011. Oh yes, there was another burst of stupid left. There shouldn't have been but there was and in 2020 the 10 year Treasury yield was 0.65% (!!) You would have thought that the roughly 3% rate in and around 2011 would have been the bottom because with actual inflation running around that number you shouldn't be able to borrow for less than the inflation rate because you will pay it back (if you pay it back) with inflated dollars.
You'd have been wrong.
The difference between 3% and 0.65% is nearly a factor of five in terms of interest cost and thus the amount of leverage that can be out at 3% is less than one quarter of that which can be out at 0.65% for an equivalent coupon.
Right now the TNX stands at roughly 3.1% so that entire 4x multiple has disappeared.
The policies of our government have led to this. The belief that we can spent six trillion dollars on alleged "pandemic relief" without consequence because rates will stay pinned to the floor was stupid.
Worse what we've done to Russia with sanctions has slammed the door on sequestering trade flows in dollars. Why? Because if you produce things overseas you'd be out of your mind to price them in dollars rather than your own currency when your nation might be next. "Oh, that will never happen" sounds quaint, but how certain are you when if you're wrong you're instantly bankrupted? Why would you take that risk when you can insist on payment in your currency? Nobody would, nobody is and nobody will going forward.
This in turn means that every dollar spent in deficit by the federal government will instantly be reflected back into inflation. No exceptions.
Has the Biden Administration -- and Yellen, who I remind you was running The Fed before she was running Biden's Treasury Department -- said anything about cutting that crap out? To the contrary; they intend to continue it.
Well, good luck with that.
Note above -- a four times multiple on the amount borrowable at a given interest payment has already disappeared.
Now where was the S&P 500?
About 1350.
What is the difference between 1350 and where it is now?
About four times.

Where do you think the S&P 500 should be trading right now assuming the TNX is going to at least stay here?
Oh sure, the markets will go up and down, maybe quite a lot. But at the core of things is the cost of financing and whether you can allegedly "build a business" that produces nothing in actual profits yet keeps getting financed and allegedly is worth more and more, and thus has a higher and higher stock price, simply because you can roll over the debt at a lower carrying cost per million every time you feel like it.
Can The Fed turn around and change its mind? Not really, because as I've pointed out without sequestering the funds overseas via trade, which is nobody is willing to do anymore if they have an IQ larger than their shoe size, all deficit spending instantly reflects back into inflation right here in the United States and the only way to stomp on inflation is to withdraw the excess credit from the system since there's nowhere to hide it anymore.
If you think the market run over the last five or ten years has been "reasonable" you're nuts.
If you think it can be sustained with a TNX at 3.1% and flat to rising you're wrong.
And if you think The Fed is going to allow 5, 6, 8 or 10% inflation prints to continue you're wrong there too because while you might escape being bankrupted by that others will not, it eventually drives people out of the workforce as there is no point if you can't make the bills despite working and the lower half of the economic strata, from the bottom up, starves, riots, burns, loots and revolts.
Yeah.
Oh by the way did you see the recent Consumer Credit number? January revolving (credit card) debt was +11.8%, February 16.2% and March was up more than doubled February's rate at 35.3%, all annualized.
The average American has hit the wall, is surviving on wildly-accelerating credit card balances and either the current rampaging inflation is stomped on now or we're going to get a nasty recession and probable civil unrest -- or worse.

The recession has already started -- by the data -- and is inevitable so all we're debating now is the latter and whether the government and Fed do the right thing or not the stock market isn't going to be trading anywhere near where it is today.