I really enjoyed the article on the gold ratios I have been wanting to buy an option for march 04 for newmont mining, but I am unsure if I should wait for the price to go back down first since the option is not cheap. I am curious to hear what you think. (My concern is that is that article and others have said that the price of gold could go up between august and november for the first wave.
Knowing when to buy Newmont at this point is a tough call. Gold and gold stocks are erratic in the way they trade. They just don't establish smooth uptrends very often. It's more like two or three steps up, and then a violent step back to try to shake out the weak longs and then they move up again.
My strategy has been to add to gold and gold stock longs when gold gets down to its rising 200 day moving average (it happened last week). The average is currently at $341. The other entry point that I use is when the net commercial index according to the Blees report gets close to 100. It's currently at 75.
I think Richard Russell might have the right idea. You pretty much have to buy it and forget that you own it. It's going up, but the path it may take in the meantime is hard to predict.
I bought NEM LEAPS when NEM was at 24.5. But I'm not sure that options are the best way to go at this point for most people due to the fact that gold and gold stocks are so volatile. It may be better to buy the stock and just hold on to it.
I have been wanting to buy an option for march 04 for newmont mining, but I am unsure if I should wait for the price to go back down first since the option is not cheap. I am curious to hear what you think. (My concern is that is that article and others have said that the price of gold could go up between august and november for the first wave.