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Take Advantage Of This Multi-Week Correction In Gold And Silver

By The Gold Report CommoditiesMay 24, 2016 01:35AM ET
www.investing.com/analysis/how-to-take-advantage-of-multi-week-correction-in-gold-and-silver-200131722
Take Advantage Of This Multi-Week Correction In Gold And Silver
By The Gold Report   |  May 24, 2016 01:35AM ET
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Technical analyst Jack Chan finds gold stocks are on a short-term sell signal and reveals an excellent entry point.

HUI Gold BUGS Index Daily Chart
HUI Gold BUGS Index Daily Chart

Gold stocks (via SPDR Gold Shares (NYSE:GLD)) remain on short-term sell signal, and if we are in a bull market, prices should find support at the 200ema (exponential moving average), which may be an excellent entry.

GLD SPDR Gold Shares Daily Chart
GLD SPDR Gold Shares Daily Chart

There is a divergence in place, and as we have often observed, such divergence can lead to a multi-week correction.

SLV iShares Silver Trust Daily Chart
SLV iShares Silver Trust Daily Chart

iShares Silver Trust (NYSE:SLV): We are short from 16.25 with stop now at break even for a free trade at worst.

Summary
We took a short position on SLV and will look for more set ups in the sector to take advantage of a multi-week correction now in progress.

About The Author: Jack Chan is the editor of Simply Profits, established in 2006. Chan bought his first mining stock, Hoko Exploration, in 1979, and has been active in the markets for the past 37 years. Technical analysis has helped him filter out the noise and focus on the when, and leave the why to the fundamental analysts. His proprietary trading models have enabled him to identify the NASDAQ top in 2000, the new gold bull market in 2001, the stock market top in 2007, and the U.S. dollar bottom in 2011.

Disclosure:
1) Statements and opinions expressed are the opinions of Jack Chan and not of Streetwise Reports or its officers. Jack Chan is wholly responsible for the validity of the statements. Streetwise Reports was not involved in any aspect of the article preparation or editing so the author could speak independently about the sector. Jack Chan was not paid by Streetwise Reports LLC for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. 2) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports. 3) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their families are prohibited from making purchases and/or sales of those securities in the open market or otherwise during the up-to-four-week interval from the time of the interview until after it publishes.

Take Advantage Of This Multi-Week Correction In Gold And Silver
 

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Take Advantage Of This Multi-Week Correction In Gold And Silver

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Brad Smith
Brad Smith May 24, 2016 11:21AM GMT
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Did anyone try calling the GLD hotline at (866) 320 4053 in search of numerical details on GLD's insurance? The prospectus vaguely states "The Custodian maintains insurance with regard to its business on such terms and conditions as it considers appropriate which does not cover the full amount of gold held in custody." When I asked about how much of the gold was insured, the representative proceeded to act as if he didn't know and said they were just the "marketing agent" for GLD. What kind of marketing agent would not know such basic information about a product they are marketing? It seems like they are deliberately hiding information from investors.
Brad Smith
Brad Smith May 24, 2016 11:18AM GMT
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"SPDR Gold Shares"..With regards to GLD, why is there a clause in the GLD prospectus that states GLD has no right to audit subcustodial gold holdings? Why would the organizations behind GLD forfeit this right and create this massive audit loophole? I haven't heard of a single good reason for the existence of this loophole so far. In addition to the audit loophole, GLD claims to be fully backed by physical gold bullion but yet it refuses to give retail investors the right to redeem for any of these ‘claimed’ gold bullion...I remember CNBC's Bob Pisani visiting GLD's vault in a well documented segment. GLD's administration arranged this visit to disprove everyone claiming that GLD's gold did not exist. However, Mr. Pisani held up a gold bar with the following serial number - ZJ6752. This serial number did not appear on the most recent bar list during that time period. Cheviot Asset Management’s Ned Naylor-Leyland later found out that this "GLD" bar actually belonged to ETF Securities.
 
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