Gold, silver, and miners plunged once again today, and your profits have grown even more. The decline (and profit growth) has been particularly big in case of the junior miners. The GDXJ was very close to reaching our binding profit-take level.

Also, do you recall what we wrote about the USD Index? That it declined very far very fast and that it's likely to invalidate its March breakdowns? It already happened today.

The slide in the miners is to a considerable extent driven by the decline in stocks, so when stocks correct, we can expect the same thing in the miners.

In today's regular Gold & Silver Trading Alert, we wrote that stocks are likely to slide further, and that the next strong support level is provided by the 2018 lows. Indeed, stocks plunged in today's session and it will only take another similar move as today's session (so far) for the S&P 500 to reach its 2018 low. Once stocks reach this level, we expect a rebound. This may not be the final bottom (in fact, I don't expect it to be), but please note that even during the 2008 plunge, there were periodic corrections, especially after particularly sharp slides.

This applies also to the precious metals sector, especially mining stocks.

Now, since the general stock market is quite likely to decline by as much as it had already declined today and then reverse, we could expect something similar to take place in the miners.

In case of the GDX ETF, doubling today's decline (taking into account yesterday's closing price and the price that we see at the moment of writing these words), would take it exactly to our take-profit level that we described previously. Consequently, we are leaving it more or less intact. "More or less" as we are moving it slightly higher to maximize the odds of getting out of the market - the rebound could be sharp.

In case of silver, we are leaving the profit-take completely intact.

However, junior miners - the GDXJ ETF - declined particularly hard recently, and this means that - unlike GDX - they are likely to drop below their mid-2019 lows, if they are to repeat today's slide.

In case of the GDXJ, the more appropriate take-profit level would be the 2018 lows of about $26.

Moreover, we are moving the binding profit-take level for gold to $1,472. However, please note that we might also exit this position earlier, if silver or miners reach their own profit-take levels.

You will find details below - please note that we are changing the "initial targets" for the leveraged ETNs to "binding profit-take levels". The prices are close enough to provide more precise targets. Also, please keep in mind that if the targets for the underlying markets are reached (gold, silver, GDX, GDXJ), the positions in the leveraged ETNs should also be closed.

To summarize:

Trading capital (supplementary part of the portfolio; our opinion): Full speculative short positions (250% of the full position) in gold, silver, and mining stocks are justified from the risk/reward perspective with the following stop-loss orders and binding exit profit-take price levels:

• Gold futures: profit-take exit price: $1,472; stop-loss: $1,712; binding profit-take level for the DGLD ETN: $27.30; stop-loss for the DGLD ETN: $19.88

• Silver futures: profit-take exit price: $14.63; stop-loss: none (if gold moved to $1,712 we would view silver positions as no longer valid); binding profit-take level for the DSLV ETN: $26.10; stop-loss for the DSLV ETN: none (if gold moved to $1,712 we would view silver positions as no longer valid)

• Mining stocks (price levels for the GDX ETF): binding profit-take exit price: $21.12; stop-loss: $29.51; binding profit-take level for the DUST ETF: $11.19; stop-loss for the DUST ETF $4.25

In case one wants to bet on junior mining stocks' prices, here are the stop-loss details and target prices:

• GDXJ ETF: binding profit-take exit price: $26.53; stop-loss: $42.12

• JDST ETF: binding profit-take exit price: $24.88; stop-loss: $7.84

Long-term capital (core part of the portfolio; our opinion): No positions (in other words: cash)

Insurance capital (core part of the portfolio; our opinion): Full position

By the way, we are opening a possibility to extend one's subscription for a year with a 10% discount in the yearly subscription fee. It also applies to our All-Inclusive Package (if you didn't know - we just made huge gains shorting crude oil and are also making money on the decline in stocks). The boring time in the PMs is over and the time to pay close attention to the market is here - it might be a good idea to secure more access while saving 10% at the same time. You can proceed using the following link, or my replying to this e-mail:

Secure more access at a discount.

Thank you.

Sincerely,
Przemyslaw Radomski, CFA
Editor-in-chief, Gold & Silver Fund Manager