Category Archives: Ed Seykota

Silver Top?

April 4, 2024 By in David Weis, Ed Seykota, Gold & Silver, Silver Collapse, SLV, Wyckoff, zsl 4 Comments

Know Your Market

There’s been something wrong with the precious metal’s, gold and silver, for years.

Gold and silver used to move essentially in tandem, over the long term; not anymore.

This link shows there’s a huge divergence in the correlation between the two metals. Gold has launched higher, while silver has lagged.

Right around June of 2020, the correlation began to break down. What else was going on (or being ‘rolled out’) around June of 2020?

Recall, silver’s primarily an industrial metal; affected much more (than gold) by manufacturing demand.

Strategy First

Shown by the market itself, direct correlation between silver and gold no longer applies (or has somehow changed into a new construct), silver’s not confirming the ‘inflation’ shtick, possibly influenced more by industrial demand.

Thus, we have the following.

Silver SLV, Weekly

Just listening to what the market’s telling us, it says, when SLV, reaches a top and inflection point (to reverse lower), it tends to print heavy upside volume bar(s).

Looking at the chart, price action’s all over the place. Wide bars, volume spikes, the gamut.

Markets like this are unstable and usually can’t mount a sustained move in either direction.

Typically, if there’s going to be a breakout (or breakdown), price action tends to get tight, or get itself into a ‘coil’.

Even so, we need to account for the market itself.

Having traded silver futures contracts during the last run up and meltdown from 2011 – 2014, the silver market is thin and likes to ‘spike’.

That (spike) behavior is confirmed by Ed Seykota in Market Wizards and David Wies in his (formerly) daily market updates.

We may be at the beginning of a set-up for a Wyckoff up-thrust (above resistance) and then reversal.

A possible measured move for SLV (to be covered in another update), puts the tracking ETF, right around 25.60, about 2-pts. from where we are now (not advice, not a recommendation).

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Gold Bulls Continue On

November 18, 2021 By in DUST, Ed Seykota, GDX, GDXJ, GLD, GOLD, Gold Miners, Positions, Wyckoff, ZeroHedge

Even As The Miners Reverse

After attempting to breakout higher over the past six trading sessions, the miners are posting signs of a nascent reversal.

Even so, the bull calls continue.

The latest round includes two more articles from ZeroHedge:

Gold Breakout Imminent !

The first part describes some technical details that are all true … after that, well, you decide.

Turns out, gold is going to skyrocket because of Russia !

I suppose, anything can happen.

We get fundamentals and anecdotal data as the reasoning for a Russia driven up-side breakout.

The problem with fundamentals is, they don’t work.

They never have worked.

Wyckoff discovered this a century ago when he said (from his autobiography) that ‘stocks move based on a power of their own. That power, has nothing to do with fundamentals.’

Trading genius Ed Seykota repeated that truth during his interview for ‘Market Wizards’.

He called them ‘funny mentals’ and went on to say he nearly, if not always lost money using them.

Gold shhh …

This article’s so good that I have to pay to read it.

From reading the shaded area, we can infer a similar (bullish) discussion to the first link above.

Sorry, not interested.

Summary

This time really could be different. Gold could launch into a sustained upward breakout.

However, the charts (GDX, GDXJ) at this juncture, are saying ‘not yet’.

Maintaining short (not advice, not a recommendation) via DUST … which is now in the green.

Stay Tuned

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Biotech Demolition

April 17, 2021 By in Biotech, BIS, Ed Seykota, IBB, LABD, Project Stimulus, SPBIO, The Speck 1 Comment

You have to wonder; once the ruling oligarchs are finished with the first (‘speck’) round, moving on to the next fabricated crisis, if biotech’s not going to be thrown under the bus.

After all, its served its purpose.

According to comments posted beneath this article, about 33%, of the U.S. population have (apparently, voluntarily) injected themselves.

According to this link, it’s about 24%, of the population.

Either way, it’s a lot … in the tens of millions.

It’s a crazy business model; systematically destroy your customer base.

Said many times in these updates, attempting to match fundamentals to technicals is usually not successful.

Sector Analysis:

Referring back to Ed Seykota, in his ‘Market Wizards‘ interview, he said using fundamentals as a basis for positioning, rarely if ever, worked.

Still, it’s undeniable something very wrong is going on in the sector.

Our market table has been updated and we’ve included the S&P Biotech Sector, SPBIO:

All markets are within fractions of a percent of all time highs except for semis, mid-caps and biotech.

The S&P biotech is down a whopping, 25%.

It’s already well in bear market territory.

Positioning:

Since we’re working the short side (not advice, not a recommendation), the focus is on biotech and specifically LABD.

The fund attempts to track the 3X inverse of SPBIO.

With that kind of leverage, LABD has significant downside bias. Positioning (from experience) is best suited when the move is sustainable and persistent.

Looking at the chart of LABD, we could be there. At this time, the fund is trending higher at a stiff +820%, on an annualized basis.

Project Stimulus:

Our Project account is positioned as shown. Since the account’s not large enough to enable leverage as determined by the broker, we just have to wait it out till it gets there (currently set at $2,000).

Summary:

Stated in The Rich And The Super Rich (if memory serves), not since Marie Antionette have the ruling oligarchs allowed themselves to be out in the open.

Seems like her demise cured them of having to get (direct) attention.

That would mean, people in the public eye at this point, are just useful idiots. And when their usefulness has run its course … ???

From watching them, it’s obvious they’re delusional … thinking they can tame evil (even harming children) and escape wrath.

“And for this cause God shall send them strong delusion, that they should believe a lie:”

The entire ‘transhumanism’ agenda is an attempt to cheat death … to avoid judgement … to outsmart the almighty.

Good luck with that.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

Breakin’ the Law

April 15, 2021 By in Biotech, BIS, Ed Seykota, IBB, LABD, Project Stimulus 1 Comment

12:09 p.m. EST:

‘Know when to break the rules’

‘Always follow the rules’ was the admonition of Ed Seykota.

Almost in the very next sentence of his interview he said, ‘know when to break the rules’.

Could this be it?

At trader’s discretion, we’re maintaining short biotech via LABD (not advice, not a recommendation).

More analysis to follow.

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.