Thoughts on Markets

Sunday, May 09, 2010

Be very cautious in all markets.

Folks, It appears to me that the boyz have moved back in to cap silver in a big way and gold to some extent. During the last week, the precious metals were preferred by many as a store of value in the face of financial and the Gulf of Mexico oil disasters. The rumors of attacks on Iran have been making the email circuit, too. There are challenges on every side of us. Like Richard Russell, I will be sticking with some cash, precious metals, and mining stocks.



It is Sunday night and I hope that each of you have attended corporate worship in concert with God's Law. He requires His people to regularly attend worship with other believers. It is a blessing to hear God's word faithfully preached, participate in the Lord's Supper and share the fellowship and encouragement of the church of Jesus Christ who is the head of His church.

The market took a big hit on both Thursday and Friday of last week. I was glad to see that the miners, though hit, were not taken down as much as the DOW and the market in general. There was concern over the PIIGS (Portugal, Italy, Ireland, Greece, and Spain) of Europe, but the general market has been topping for some time.

From Bloomberg.com tonight, the report is that the European Union is planning a bailout of some $645 Billion Germany has stood firmly against bailouts, but it is seen as necessary at present. Europe has stood fast in a conservative mode until now. You can read the article HERE.

I am concerned about the general market and believe we are coming to a "Y" which could go either direction. This could be the end of the bear rally or only a relatively short term correction which from the perspective of many investors could end with a bailout for Europe. I believe we will see an upward bounce tomorrow, but I am not convinced that it will happen. I do not believe that we will see a Black Monday.

I will be on the road to the Money Show in Las Vegas tomorrow. It seems that there is always turmoil in the markets when I am on the road. While at the show, I should have the opportunity to check the market from time to time. However, I will miss not being continuously in contact with the action as I am at home.

The Lord has blessed me once again. There was a hard drive failure on my main computer, but the lap top and the desktop back up were available. The main computer is back up and beginning to get fully updated. It is always a challenge to get all the programs back in working and updated order, as many of you know. But the Lord has blessed me with virtually full back up, so other than the hassle, it was not a disaster.

I am considering putting in some trailing stops on a portion of my mining stocks portfolios. However, it will be for only a portion as I never want to be without miners. Too many times, I have been stopped out to my regret and have learned to use stops sparingly.

Last week, I bought DROOY, FVITF, and HMY. They were all in nice buying range from my perspective. I always buy in small increments and try to average up and even down when prices get near lows.

Currencies from Kitco.com:

Gold is down in ALL CURRENCIES EXCEPT THE JAPANESE YEN. Thus, we should expect a lower day tomorrow. This is not always true, but often is. It is time to be cautious all around. Be quick to lock in profits and very cautious about purchases.

Depend upon the Lord for life. To do otherwise is to prefer eternal death.

Best to each, Doug

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