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Friday, November 6, 2009

Gold Miner Play

First, let me be clear, I see high risk everywhere. By no means should anyone reading this post take this for the same confidence I had in buying gold miners back in October 2008.

Buying into the Gold Miner ETF, GDX is a decent risk play at this point, with a defined entry/exit point. I plan on buying additional shares if/when GDX hits the bull trend line again (lower line on picture) . I may buy may on any given day, with stops to build a position in case miners make a run for the upper bear trend line. My stop (exit) point will be 1 buck below the trend line when GDX hits the bull trend line.

Right now, that is about 41.50. I'll sell vast majority of miners if we hit that point again. Keep in mind some sort of devastating event could cause the miners to "gap down" over night, and best price you can get is much lower than your stop. However, I would think that kind of fear would keep gold up, not down.

If interest in gold miners, you can get higher returns and possibly lower risk by using the links on this blog to investigate individual miners. I have gold miners on my "stock play" tab on the right.

I'll probably go back to posting news items on this blog, until GDX breaks out of the upper line depicted, or breaks below the bull trend line.
From WebSufinMurfs FinancialBlog2

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