We think the opposite of everybody else.
Almost nobody is in “buy mode”
Price moves in waves.
You know this.
Most people do not know this.
You’ve seen it many many times already. We have a move in either direction, and what does sentiment do? What does the media do? What does Twitter do?
They act like this is going to be the move forever.
Nobody knows how to zoom out.
I take it back, mega funds and billionaires do. Everyone else? Rare.
I know which side I want to be on.
Bull markets and up moves bore the shit out of me. As a content creator, engagement and excitement from my followers is at an all time high (check yourselves), but I struggle with something useful to say that I haven’t said dozens of times already.
During these drops however, my sheepish grin gets larger and larger the more I see price fall.
Some things are falling, some are not.
Some of these markets are in a steady uptrend. Others I think have further to go long-term.
So let’s look at them a bit further.
All charts are courtesy of MarketWatch
Here is Year-to-Date Gold
And let’s go ahead and throw YTD Silver up there as well:
Both of these metals have been on a consistent long-term uptrend, and for very good reason as I’m sure most of my contrarians know.
However, gold has only fallen .33% year to date. Silver has fallen over 16%.
Where does the value lie here?
Silver, of course.
They also know that mining stocks have gotten hit worse than the underlying metals have in 2022.
But have they in 2023? Let’s look.
Remember, gold has pretty much broke even this year, silver has dropped 16%.
Here is GDX
Down 6%, compared to near 0% for gold itself.
And the big silver miners ETF, ticker symbol SIL
So the value we continue to be gifted from even the top blue-chip mining companies is still happening!
Thought I was going to throw a curveball out there, huh? Nope. Not this time.
My point with precious metals is, even though they are stocks, which can be problematic at times, we have all seen how they move when the underlying metals start to make their true moves upward. It’s great.
My mining portfolio is still up nicely because I got in early, bought on drops, avoided super risky juniors (for the most part) and kept holding.
“But price was lower then”. Yeah it was — but at the time it wasn’t. I could have sat there and longed for $1000 gold to come back some day and just buy then, but then I wouldn’t own any gold or gold mining stocks today.
I just wanted to be historically correct. And I was.
This is different than what is happening with crypto, where I am anticipating lower lows, and don’t have much interest in buying more until then.
But let’s revisit Natural Gas once again.
And open up a 12 month chart for context.
Quite a drop, and a drop which occurred on short-term fundamentals.
We need to once again zoom out to a long term chart to see what really happens with Nat Gas. This one goes all the way back to 2009.
If price gets down to these levels, they don’t stay there for very long.
And you can see the increasing overall demand for it in recent years.
Add in deglobalization and a war, and you have the recipe for a much bigger move higher. Eventually.
I love this, and have put a trailing buy on UNG so I can average down.
Don’t Forget To Take Profit
I may as well say this now, while we’re all thinking rationally. Because soon you won’t be.
I am not going to go dig them up right now, but if you look back on my Twitter timeline, you will see me put out warnings for you to take profit or adjust your positions accordingly on several instruments.
Silver, TWT, DOT all come to mind.
And every time I did this, it was near a mid-term top.
But how many of you actually took profit?
I would wager to say less than 10%.
And you guys are the audience who is supposed to “get it”!
Imagine what all the normies are doing. Probably buying at those tops.
Yes, there are a few other spots I’m looking at right now, but these are the major three.
None of this has to be difficult if you don’t want it to be.
Just have an educated bias, recognize these periods of time, and take action.