Bought 200 K.TO @ $15.94

Update Aug 13: I got stopped out at $15.80 for small loss.

Precious metals and the miners are holding well in today’s 30 point drop in S&P (WSJ article). In particular, gold just made a higher low (Figure 1) and AUD/USD is holding 0.8900 somewhat. As such, I’ve lowered my mental stop on the PAA.TO short to $24.30, a mere few cents above. Secondly, I am taking a long position in the Kinross Gold Corp. (K.TO).

Gold

As evident in Figure 2, Kinross has been taking a beating the past year. However, it is trading on a long term Fibonacci support level around $15.80. Thus, I am buying here with a small position while Kinross is making higher lows intraday and on the daily (so far).

I have set a mental stop at $15.60 and a hard stop at $15.50.

Risk is ($15.94-$15.50) * 200 = $88 + $9.90 commission = $97.9 = 1% of account.

Kinross Gold Corp. (K.TO) weekly chart

Kinross Gold Corp. (K.TO) daily chart

Sold 250 VEN.TO @ $7.89, Profit +2.4%

Ventana Gold Corp (VEN.TO) is testing its resistance at $8.00 corresponding to a 38% retracement level from the mid-June dive (Figure 1). Furthermore, gold is tracing an inverse cup-and-handle with a resistance at $1170 (Figure 2). So rather than wait and see if VEN can break upward, I decided to book my profit and watch from the sideline.

Ventana Gold Corp. (VEN.TO)

Gold (from Finviz)

The past few weeks have been difficult as I have had a series of losing trades. So I am playing it safe until my account can make a new high. Which is actually just a couple of percentage point away.

In any case, the profit for this trade is ($7.89 – $6.93) * 250 = $240 – $9.90 commission = $230.10 = +2.4% in account.

I can’t help but feel that VEN will continue its rapid climb for a couple more days. I am eyeing the 50% retracement level at $8.50 as an immediate target if VEN does break through.

Bought 250 VEN.TO @ $6.93

I’m long Ventana Gold Corp. (VEN.TO), a junior gold mining company. Here’s a look at gold (Figure 1) and the junior gold mining company index (GDXJ, Figure 2).

Gold

Market Vectors Junior Gold Miners ETF (GDXJ)

Both figures are from Finviz.

The reason why I picked VEN in particular is related to this article in June. Ventana Gold raises $20 million in private placement. Silver Wheaton (SLW) paid $20 million for shares priced at $11.11 per share back in June. SLW is a well managed company in the precious metal industry. I’ve traded it before and it has always been on my radar to buy.

VEN has been taking a heavy beating in the past few weeks since SLW’s investment as shown in Figure 3.

Ventana Gold Corp. (VEN.TO)

$6.80 is the 50% retracement level to that recent rally (the first since the dive beginning in June). It seems to be holding well today despite market weakness.

Furthermore, EUR/USD rocketed upward and is trading around 1.29. This isn’t something to be ignored.

So I’m taking a small bet here at $6.93. Stop loss order is opened at $6.40. My risk is thus, ($6.93 – $6.40) * 250 = $132.50 + $9.90 commission = $142.40 = 1.5% of account.

Sold 3 ABX 10OCT Puts 46.00 @ $4.15, Mark $43.97, Breakeven exit

My Barrick Gold short isn’t working as I hoped. My puts premium is moving closer to breakeven to my purchase price of $4.00. Furthermore, the market is cracking above resistance levels today. In particular, ABX.TO is marking a bullish engulfing candlestick pattern after a test of its 50-day moving average support (Figure 1).

Yes I know, there’s a massive resistance at $44.00 for ABX.TO. But…

As much as I’d like to believe in the bears, this short position is not safe anymore. I can’t let a positive trade turn negative. It’s better to miss an opportunity than lose money. So I’m ditching this now to reduce my risks at above breakeven seeing that I have another smaller short position in play. Which is underwater at the close, by the way.

My return on this trade is ($4.15 – $4.00) * 100 * 3 contracts = $45 – $12.95 x 2 commissions = $19.10

I’m just lightly short now and mostly in cash.

Barrick Gold (ABX.TO)

ABX.TO intraday

Bought 3 ABX 10OCT Puts 46.00 @ 4.00, Mark $44.67

Right on the heel of my oil short loss, I am taking another stab at shorting the market. This one is Barrick Gold (ABX.TO). I am moving away from shorting financials because the puts premium are almost doubled that of the calls! It seems that too many people are betting the banks will take a hit in the next fall.

In the long term, ABX.TO appears to be in an up trend. However, the intermediate trend is turning negative as shown in Figure 1. $45 is an obvious resistance for ABX.TO. Even with today’s positive market moves, ABX.TO fail to catch on the bullish wave and only touched $44.86 in the morning optimism (Figure 2). Who knows, perhaps it might break it sooner than later. But the reward/risk is decent to short ABX.TO seeing that the $45 resistance is right above.

Barrick Gold (ABX.TO)

I will give it a month’s time to move below $44.00. Worst case stop loss is $2.50 on the premium. That is ($2.50 – $4.00) x 100 x 3 = -$450 – $12.95 x 2 = $475.90 = 5% of account total. My mental stop is $3.00 on the premium. Which is about 3.3% of my account total.

ABX.TO intraday