Dana Lyons – Selling The Rips To Weed Out Yesterday’s Market Heroes, And Technical Outlook On The Energy Sector
Dana Lyons, Fund Manager and Editor of the Lyons Share, joins us to discuss the turbulent markets, through the lens of quantitative and technical analysis, and review which sectors look appealing for both long and short strategies. We start off discussing how his approach recently has been to take a two-pronged approach during this recent relief rally in the markets to take some profits on new positions that they put on during the lows in mid-May, and also to sell out of sectors or positions that they no longer want long exposure to now that they’ve bounced up near resistance or prior breakdown levels. Dana makes the point that this is part of the process of weeding out yesterday’s heroes in one’s portfolio as part of sector rotation strategy, and that prior leaders in the general stock markets likely won’t be leaders in the next upcycle.
Next we shift over to the technical outlook on the energy sector, and how he is viewing the continued strength in the oil sector and oil and nat gas stocks as something to continue holding and buying on dips, but he’s not actively buying here or worried it has topped out. Dana also mentions he is using the recent bounce in other related energy sectors like uranium, lithium, and rare earths to lighten up or exit those positions. In addition, he is using the bounce in the agricultural commodities and grains to lighten up or exit those positions as well.
Click here to stay up to date with Dana at the Lyons Share website.
Hi Glenfidish – Thanks for sharing your technical outlook.
I’d love it if you are correct and we see a monthly candle in June close at $1981, but personally, I’m not expecting the Precious Metals to really blast off until later in the summer or early Fall, when the Fed finishes it’s rate hiking cycle, and then finally pauses. The market will see that as a “Powell Pivot” at that time, expecting that the inevitable conclusion is to eventually reverse course and start cutting rates or possibly implement QE again; so then we’ll see the real fireworks begin.
For now, I expect we’ll continue to be stuck in the muck during the summer doldrums, and I just don’t want to see a close in Gold on a weekly or monthly basis below key support at $1780. If that support was to break, then I’d want to see support at $1721 hold in Gold.
With Silver, it’s been meandering on either side of the key $21.41 level for the last month or so, and if it does break down, I really don’t want to see that $18.75-$19 level break, and would prefer that those levels don’t get tested at all. On the positive, if Silver was able to reclaim $23-$24 by month-end, then that would show the dive down in the mid $20s was just a bear trap, so I’d see that as quite constructive.
Ex, Newmont may be a bellwether tomorrow.
Could it be an extended inverse H&S?
If so, my target is 63.70-63.85.
Also, it’s a MaxSat (6).
Hi BDC. Yeah, going back to the peak in 2020 to present it could be an upward tilted inverse H&S in Nemont getting closer to finish the higher right shoulder. However, conversely, on a shorter-term basis the run up to $85.42 could have been the head of a standard H&S pattern… although neither is a very textbook H&S pattern and both charts are a bit busier and messier than idea for either to be true.
Regardless, based on your Max Stats at 6 is sounds like it is getting near a turn.
This area: https://postimg.cc/VrhynZrY
Tomorrow may be ‘interesting’.
Ex,
Thank you for your views and forward opinion regarding the price objectives and most importantly the support levels.
You could be correct but the month is very young and I have never ever seen this bearishness in the miners in all my investing. Let’s see what gives amigo!
Glen
Agreed Glenfidish… the month is still young and we still have 2/3rds to go. I’m thinking we’ll just see a continued slog sideways for now, and personally will be happy with Gold staying in the mid $1800s.
If I had my preferences I’d like to see the monthly & quarterly close above $1835, but would be even happier if we close the quarter above $1850. Anything higher than that like a move up to the $1880s or to challenge $1900 again, would be icing on the cake for me personally. If gold actually shot up to $1981 by month’s end/quarter’s end like you mentioned, it would be pretty surprising, but, of course that would be totally great and would really light a fire in the mining stocks. I don’t know of anyone else that has such a bullish prediction by the end of June, and I’m rooting for your outcome man, as that would be fantastic for all of us. Again, for me, anything over $1835 or $1850 would be a win.
As for the mining stocks, they are ugly and sentiment is lousy, but I don’t think that will last much longer (maybe a few more months). Hey we’ve got the rescheduled PDAC conference next week so we’ll see if the PDAC curse strikes again, haha!
I’m getting ready to post an editorial with our buddy Erik, the Hedgeless Horseman, where we get into the negative sentiment in miners currently, position sizing, and how a few winners in one’s portfolio will buoy the rest of it. We had a similar chat with Dave Erfle earlier in the week when Lion One went on a huge run in our portfolios on the stellar drill results.
Glen……… your numbers are fine with me………..
Doc I will give you credit in regards to the miners going lower king time ago! Credit is do..
However gold real gold and silver have not really flinched so we know the rig paper gold comex is at an all time high. Not suprised. Stocks should never have been this low in a real market. Play the game there not getting shit from me. We are turning at any moment latest turn is September/October i don’t see it. If it happens then docs double bottom of many miners comes true talk about two separate entities in the real stuff and paper as Jerry has mentioned for years!
Fasten your seat belts!
Yep, Doc and Jordan were right about the miners needing more time to correct, not just in price but in time, and boy the juniors have just been decimated here. Doc having such a big cash position has been a wise place to be, and at times like these I wish I had sold more in March/early April after that rally to raise more funds. At this point I’ve only got a bit more than 2.5% free funds available in the dry powder reserves, and saving that for more big washouts. I’ve still been able to pull off some profitable swing trades in the PM stocks, but they’ve been smaller trades, and more than washed out by the consistently strong selling across the board in the resource stocks.
It’s a tough time to be a resource stock speculator (unless you are all-in the oil & nat gas stocks), but this too shall pass…
By September/October, off the backs of the Fed pausing rate hikes, I could see the Juniors finally get a solid bid a surge higher, so that’s not really that much longer to wait. Buying the dips here in the short-term, should be quite rewarding for the medium to longer-term.
If this administration can’t get baby formula right, how are they going to fix inflation? Therefore, the markets shall decline to a corresponding level of stupidity. This isn’t rocket science. Janet Yellen never saw this coming? Tell ya’all what: long UVXY
Larry your 59 or so call on Newmont is what I had months ago! So I think it’s very correct!
I also think large cap is going to underperform the mid cap, small cap, developers and explorers on this move.
I remain bullish and still believe that despite my call on brixton not breaking 15 will still turn up very soon. Gold will monthly candle will finish at the target Ex and Jerry heard.
$1981 give or take… Is there anyone else willing to call this? Now is your chance
Glen