Bill-

Thanks for weighing in on this. Although this is short term and perhaps intermediate term weakness, I am sure it makes people nervous. The action makes a retest of $535 all the more likely. As memories of February's highs fade, defending key supports becomes more difficult IMO. We just need to get this period behind us and then it's onward and upward to $600+.

Disclosure: Took profit on RGLD yesterday afternoon. Long GLD.

MM:
Reads like day trading on RGLD and it is still interesting.

RGLD has a royalty approach I guess it's the properties they have that make the difference. I wonder if they're that great? Noticed they pay dividends.

Is it best to have hands dirty digging or just sit back and collect with clean pinkies when dealing in gold?

MarkM -- Isn't the RSI on GG screaming to buy on this dip?

and yes, i am long a core position of GG, but I sold most of it on the move from 20 to 28. I've been trying to resist the urge to swing trade, but the moves are significant and fairly well contained while gold bounces in this trough between 540 and 560.

C.Note/ EJ-

Yep, that can certainly be construed as day trading! It looked to me that RGLD had support but the more I looked at the sector charts and saw the selloff late in the afternoon from HUI and XAU, plus the dive the market was taking I sensed that there were weaker prices ahead. That is why I said the other day "Watch the miners here."

As I become more comfortable "reading" gold I am taking some chances. That was one. You could have bought RGLD at $27 and held it and I would have NO objection to that play either. If it firms I may take it down again.

My approach is going to be to take down sections of holdings as the stocks reach key support levels. Kind of a reverse scale-in.

GG? No, daily RSI is over 50 so it is not screaming at me. It got below $25 on the last retest of $535. Gold off early today and NY has been probing lower and lower if you look at the charts. That is JMHO and I am not advocating anyone trade off my opinions.

Gold - since 1970, gold is weak and tends to bottom in the April/May period (interestingly, that is also the lowest volatility period of the year). It is also weak in August. This is simply a seasonal cycle that will work its way out in time, imo. As your trading knowledge improves, you will begin to overlap different methods - fundamental, TA, trends, cycles etc. Being unaware of this seasonal cycle has probably cost some traders money who bought gold at the highs (overlapping overbought conditions) before the weakness set in. The recent action in gold has been expected based on seasonalities. The only major move in gold outside of the 2006 trading range would be a geopolitical event moving the price to new highs, IMO, because the fundamentals are improving, not weakening.

Someone has a nice defensive line drawn on the chart here. How'd you like THAT bounce? Straight up!

MM:
My chart show a very big spinning top.

All-

It would serve me right if RGLD took off from here and hid! (Daytrading , indeed.)

Anyone notice the volumes here in the gold and miner market? Is it a holiday and I missed it?

Volume way down, especially since i didn't act on the "screaming" buy on GG this morning... :)

EJ-

Well, I see that it is off 13 cents today so you can buy me a stick of gum with that if we ever meet, okay? :)

At least you picked one that is performing well relative to the underlying metal. Most of these are grossly underperforming.

Nice sell-off in the p.m. again today by the miners. Sheesh. At least I could buy RGLD back now if I was of a mind to....

I'm honed in on GG and AEM (GG because of its low production cost). I am waiting to jump back in and, at least this a.m., the 7 day RSI was under 30. I have been trading the miners on three things: RSI, Bill's calls, and intuition. So far, so good, but I realize that in the long run, buy and hold is typically the best strategy, which is why i latched on to GLD in November and just let that position sit.

EJ-

What you look for is the miners holding their ground while the metal continues to fall. A case in point was the action on the morning of March 10. Because it was relatively early in the game seasonally, that one was a good bounce trade. If it happens again while gold is completing a third leg down, I WILL BE BUYING A 50% POSITION. If the miners continue to strengthen and gold stops falling I will buy 50% more after they cross key resistance.

Thanks. Hey, RGLD got a little bump late, no? I keep a watchful on the ECN to determine support/resistance, and I will take what you say into account....

Was that you? :) Right off the 30 line on the 10 minute. Someone is watching it closely....

no. i was going to take a dip, but got caught up at my real job and missed it...

I am looking at TZN, which is a target tied to NEM. I bought it last July when the yield was at 10%, it's there again. It worked out last time and I am guessing that even though NEM may have continued weakness over the next few weeks, that there will be more up months (I understand the cap) than down months over the next year. I like the yield tied to the price of NEM which is tied to the price of gold (although I am not a big proponent of structured products which tend to make more money for the issuing firm than the investor) for diversification reasons.

So; does anyone have any strong thoughts on this?