Petra Hess of PetraPicks.com is watching the action of the yen after a big move last Friday pushed the Japanese currency above its 50-period moving average for the first time since September, while also pushing the SPDR Gold Trust (GLD) up over its 50-day moving average. Hess said that the market has been giving mixed signals on gold — like increases in the price of precious metals or in the stocks of gold miners despite declines in week-over-week volumes — but noted that the precious metal has been moving in near lock-step with the currency, which is why she will be buying gold if the yen can break through its 200-day moving average early this week. Hess said she would be looking to get long in both the Van Eck Vectors Gold Miners ETF (GDX) and the Van Eck Vectors Junior Gold Miners (GDXJ), and playing the iShares S&P/TSX Global Gold ETF (XGD) and BMO Junior Gold ETF (ZJG) in Canada.
Hess said the yen will either jump through the 200-day moving average or will pull back and show that Friday’s bounce in the yen and in gold was nothing out of the ordinary and not worth trading. She said that if the GDXJ moves above $32.58, she will be looking to start a long position, expecting it to get to $33.51 — the 50-day moving average — and potentially to $34.29, the 200-day moving average.
Petra Hess runs PetraPicks.com and is a technical swing trader and long-term investor in domestic and Canadian stocks and ETFs. At the time this interview was taped on Nov. 19, she had no shares, options or open orders in either GDX or GDXJ, although she was planning to watch them for a possible purchase as described in the interview. She did own one gold stock, Kirkland Lake Gold (KL, KL.TO); she purchased 2,000 shares of the KL.TO at $17.97 (Canadian) on Friday. The Raging Bull podcast features experts from the site talking with Raging Bull editor Chuck Jaffe on his show, “Money Life with Chuck Jaffe.” You can learn more about Chuck’s daily hour of market and personal-finance chat at MoneyLifeShow.com; you can subscribe to the Raging Bull podcast via iTunes and other podcast providers.
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