Saturday we published TDG #363, a 30-page update. This update included among other things brief reports on three companies we’d consider potential non-core positions. These are three stocks which could rebound substantially from lower prices. We also discussed downside targets for GDX, GDXJ, Gold, Silver, etc and buy targets for various companies.   

I have two charts from the update here. The first is the gross short positions in Silver, which in nominal terms reached nearly 60K contracts, an all-time high. Relative to open interest the gross shorts are not yet at an all-time high.  

We carefully constructed this next chart with 23 years of data. We only took data from years Silver was in a secular bull market. We excluded 1980 as Silver peaked in January and the parabolic rise and crash could skew the results. 

Look how strong the seasonality is. Even though Silver is in a secular bull market it essentially makes no progress for half the year (March through August). The time to buy is obviously the start of July.  

We are very keen on Silver bottoming before Gold. When could it bottom? At what price? We discussed our thoughts in the premium update.  

Last week we wrote: We’ve been prepared for downside with hedges and cash and now we are thinking that the miners could break towards their December lows. Of course we’ve thought so for the last few weeks so time will tell. In any event we are waiting for that buying opportunity. Patience is now the key over the coming weeks.

The model portfolio has held up very well during this selloff. It closed the week up nearly 1% and was up about 2% after Wednesday. You live and you learn from your mistakes….or you blame manipulation and you don’t. We’ve endured two nasty bears in the last six years. It’s because of that experience that we’ve hedged ourselves well in recent months.   

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As we’ve noted in recent weeks, we’ve made some changes to our premium service that I’m very excited about. I think the quality of our premium service is higher and with subscribers able to follow our trades (knowing our plans in advance) in the new portfolio, I expect our and their performance to be better. Click below to learn more about our service and watch the new video for details.

Thanks for reading. I wish you all great health and prosperity in 2014. 

-Jordan

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