Michael is now adding to his position, but not in both metals. He thinks this one has bottomed, and this one may be close to bottoming…
Gold’s Relative Strength Index Indicating a Bottom Is Here
Today’s missive is going to be brief as there are no need for words when you have the chart below indicating every major low in gold was accompanied by an RSI reading below 30. GLD (the physical gold ETF) is sporting a 27.46 RSI this morning and while we have seen readings lower than this at other bottoming periods, it is time to open a 25% position in the GLD July $120 calls at $1.40, where I was filled shortly after the New York opening. I am now attempting to add a second 25% tranche at $1.50 with the current market $1.54.
Silver is also finding support in the $16.20-16.30 range where I successfully built a position back in March when I was able to accumulate a large position in the SLV June $15 calls in the $0.50 range. Within days, silver screamed back above $17 and the SLV was in the mid $16s where profits were taken. We are once again close to the accumulation zone for silver but based upon RSI, gold is the buy.
Originally trained during the inflationary 1970s, Michael Ballanger is a graduate of Saint Louis University where he earned a Bachelor of Science in finance and a Bachelor of Art in marketing before completing post-graduate work at the Wharton School of Finance. With more than 30 years of experience as a junior mining and exploration specialist, as well as a solid background in corporate finance, Ballanger’s adherence to the concept of “Hard Assets” allows him to focus the practice on selecting opportunities in the global resource sector with emphasis on the precious metals exploration and development sector. Ballanger takes great pleasure in visiting mineral properties around the globe in the never-ending hunt for early-stage opportunities.