Pot ETF About to Light It Up

Hey There Income Hunters,


It’s time to procure a bullish position in pot stock

.

The market has corrected almost 25% since mid-July, and there is good news from the Biden administration that will give the market a boost.


In a letter to Congress last week, the Office of National Drug Control Policy (ONDCP) proposed making it easier to research marijuana and other Schedule I substances.


This is a very good step in support of the medicinal benefits pot can bestow on society.


And the Drug Enforcement Administration (DEA) firmly believes in this support as a necessary step towards the Food and Drug Administration (FDA) approval of new drug products.


Today, I’ll pass two pot stocks I like, plus the technical pattern that provides a bullish signal for buying one now.


Biden Supportive of Moving Pot to a Schedule II Drug 


This makes total sense, since pot continues to be a Schedule I drug, while cocaine is rated less dangerous as a Schedule II (see table below) …


Table Description automatically generated


Today, the pendulum has swung, as politicians push for any tax revenue and new jobs they can find (among other reasons).


Build a portfolio of stocks that have corrected and will profit from federal decriminalization that, although delayed in 2021, will come in 2022 as Democrats must find ways to pay for all their fiscal fireworks.


The CBD industry alone is expected to grow at a compound annual growth rate (CAGR) of 40.4% for the next five years ….


Here are two stocks that are a buy now:


AdvisorShares Pure Cannabis ETF (Ticker: MSOS) 


MSOS was the first US-listed, actively managed ETF to provide exposure solely to American cannabis and hemp companies, including multi-state operators.


Thirty six states have now decriminalized cannabis for medicinal purposes, while 13 states have legalized it for recreational use.


MSOS is in a strong buy position technically. Notice the move on Friday on higher than average volume …


Chart Description automatically generated


Notice also, the two hammer candlestick patterns registered over the past 4 days. A hammer pattern is defined by:

  • A lower tail that is longer by at least 2x its body 

  • Either a red or green candle color doesn’t matter

  • The upper tail is very small and almost absent 


Hammer candlesticks usually appear in a downtrend. They are generally reliable reversal patterns. And this is an ideal situation for a reversal in trend to happen in the short-term …


Consider a MSOS 33/35 call spread for $.70 to Sept. 17. Closeout the trade on a close below $32.50.


This trade offers a return of 185% if MSOS expires on Sept.17 above $35. Any close above 33.70 nets a profit.


Grow Generation Corp. (Ticker: GRWG) 


GRWG is the pick-and-shovel supplier to many cannabis growers, operating in 12 states today and growing quickly … 


I love this company and forecast them to be the “Home Depot of the cannabis industry” in the years ahead.


GRWG is the perfect combination of a uniquely positioned business with a great strategy for growth as decriminalization sweeps across the country.


The stock is in a stable position and the recent correction makes it a good time to buy.


GRWG has put in a series of higher highs and higher lows,with an uptrend developing … At the lows, a couple of inverted hammers developed on good volume.


The inverted hammer is defined by the same bullish reversal characteristics of the hammer:

Graphical user interface, chart Description automatically generated


Consider a GRWG 33/35 call spread to Sept. 24 for $.66. 

This trade offers an over 200% maximum return and I believe the probability of GRWG reaching $35 or higher is good. If not, use a sell stop below $30.5 to limit your loss.


Bring It Home 


Last week’s employment data opened the window for money to flow into beaten down sectors, and cannabis is one of them.


The disappointment of not passing decriminalization at the Federal level should give way to positioning for passage in early 2022.


This is good timing to jump on a burst of momentum to the upside in both stocks I mentioned today  for a quick low risk/high reward play.


I hope you are enjoying the long weekend and as always …


Live and Trade With Passion My Friends,


Griff 

Glow in the Dark

Hey Influence Traders:

After my last post, I got a few emails asking where one can get an International Driving Permit.

There are only two entities authorized by the Department of State to issue them and they are here and here.

Don’t get caught without one.

Some other time I’ll tell you about when I was detained by the Swiss Border Patrol for a previously unpaid speeding ticket … that was fun!

Highlights

Opioid Fallout

Because of its role in the opioid crisis, Oxycontin maker Purdue Pharma entered into a $10 billion bankruptcy plan. The Sackler family will relinquish ownership and contribute $4.5 billion to the plan but will be shielded from future lawsuits. 

It was only 25 years ago that Big Pharma pushed opioids as the next great cure, the FDA signed off on them as a miracle drug and the medical profession got behind the push to bring them to market. Wait, are we still talking about opioids!?

Covid

Merck’s (Ticker: MRK) Ivermectin is not getting much love as a COVID treatment, so I wonder what people will think of a new study from Brazil. Despite a study from Japan showing that Ivermectin is effective at preventing COVID viral replication when patients are treated early in the disease, but the FDA is not a fan. 

I wonder how they are going to feel about a report from Brazil that scientists have discovered that venom from the Brazilian Jararacussu Pit Viper can inhibit the virus’s ability to multiply by 75%. At over 6’ in length, it is Brazil’s largest viper, so harvesting that should be fun. 

The Big Get Bigger

Employment is down and many businesses are having trouble finding workers, but two of the biggest employers are hiring. Both Amazon (Ticker: AMZN) and Walmart (Ticker: WMT) announced plans to hire tens of thousands of new workers. 

Amazon said it will hire roughly 50,000 in corporate and technology roles. It also plans to open several large physical retail locations in the U.S. that will operate like department stores.

Walmart is hiring 20,000 workers, primarily in its fulfillment centers, and advertising wages that top $20 per hour. 

Hurricane Ida Impact

Oil: Gas prices are rising after Ida shut down critical US oil operations, including more than 90% of production in the Gulf of Mexico. Louisiana’s 17 oil refineries account for 20% of US capacity. This will lead to a bump in prices and profits for Exxon (Ticker: XOM) and others.

Damage: Insurance claims are expected to be between $15-20 billion, compared to $65 billion for Katrina. In addition, it’s estimated that more than 1 million homes suffered damages totaling $220 billion in reconstruction costs. This should cause high demand at Lowes (Ticker: LOW), Home Depot (Ticker: HD) and other lumber yards.

Supply Chains

The past year has seen a plethora of supply chain problems. The pandemic, coupled with a lack of workers, is exacerbating food supply chain issues. That is going to push food prices higher, which are already suffering from overheated commodities and freight costs. 

That caused our recent Capitol Gains Kroger (Ticker: KR) trades to see a bounce and for Andrew Giovinazzi to make some #PowerMoves. 

K Street

K Street insiders all agree that we have a wild three weeks coming on Capitol Hill. An unprecedented budget and spending battle royal is on the horizon.

House leadership wants to pass two major pieces of legislation in September – a $1.2 trillion bipartisan infrastructure bill and the $3.5 trillion boondoggle Democrat spending package.

A deadline of Sept. 27 has been set to vote on the bipartisan infrastructure bill. But the progressive wing has threatened to block the bill if it is voted on prior to the boondoggle bill.

Senate support is also spiraling, with Sen. Joe Manchin urging fellow Democrats to hit “pause” on the Boondoggle spending bill.

The intraparty squabbling is causing Dem leadership as many headaches as their fights with Republicans.

Congress also needs to pass government funding legislation to avoid a shutdown. Neither house of Congress has passed the annual appropriations bills necessary to fund the government starting Oct. 1st, when the new fiscal year begins.

The most likely remedy will be Congress passing a continuing resolution to keep current spending levels constant while they negotiate longer-term spending.

Uranium

One thing that moderate Dems, progressive and Republicans are starting to agree on is that nuclear energy needs to take a more prominent role in U.S. energy policy.

Progressives, in particular, are beginning to realize that their Green New Deal, carbon-free aspirations can’t be realized through wind and solar power alone. 

That is why I’m putting Denison Mines Corp. (Ticker: DNN) into the Capitol Gains starting line-up.

DNN is a Canadian uranium exploration, development and production company. In addition to uranium mining, DNN is diversified into coal, potash and other projects.

Questions about DNN or anything else in today’s letter? Email me!

Cutting through the noise for you,

Frank


Get Ready to Make a Killing

Hey There Income Hunters,

As regular readers know, I have been pushing for trades to front-run a change in the transitory inflation narrative and thought Friday’s payroll number might be the turn …

And it certainly was …

      • Non-Farm Payrolls came in much lower than expected at 235k versus 725k expected …
      • On the inflation side, average hourly wages came in at 4.3% much higher than the 3.9% y-o-y rate expected …

Slower growth and higher inflation.

It’s the worst of both worlds for the Fed and government because it demands a dovish (stimulative) monetary and fiscal policy in the face of higher inflation …

Today I’ll give you the trades that capitalize on any delay of a tighter policy and possibly further printing of money instead …

Signs of Stagflation Strengthened in August

Stagflation is an economic condition driven by slowing growth with higher inflation.

Let’s take a quick look at the key signposts …

The Growth side of the Economy

Currently the most forward-looking growth numbers have turned down, as validated by:

      • Consumer Confidence, as measured by consumer sentiment, is nearing record lows …

      • Retail Sales plummeted in July and have only shown a meaningful advance after stimmy checks were distributed …

      • Growth, as measured by GDP projections, is sinking for Q3 based on the Fed’s model and — and that is much higher than the average of top banks who report under 3%.

This is half as much Q3 growth as the bank expectations reported in May …

The Inflation side of the Economy 

      • Natural Gas demand is soaring, mostly for powering air conditioners during the summer months. We can also expect the same from oil, as increased driving drives oil prices back to the highs.

      •  Rare Earth Minerals prices continue to soar driven by demand for batteries, defense weapons, electronic technologies and green energy. These costs will have to be passed on for finished goods.

      • Transportation of Goods Prices have pressured the Baltic Dry Index, which measures the price of moving raw materials globally. These prices are contributing to supply chain issues, which continue to fuel higher prices of essential goods and services …

The Strategy: Purchase Undervalued Commodities

In my view, the energy sector via SPDR Select Fund ETF (Ticker: XLE) is a low risk/high reward strategy …

Consider purchasing a $XLE 50/51 call spread to Oct. 15 for $.30

This strategy offers a potential 233% gain with a decent probability of success based on the technical setup of a rising 200-day moving average and daily buy volume compared to sell volume …

You can use a close below $47.64 as a stop loss if you want to limit your downside …

iShares Silver Trust ETF (Ticker: SLV)

We all know the demand side of why silver prices will rise over time. Silver is not only a key ingredient for electric vehicles, but also for solar panels. The technicals are just turning positive with a strong move above the 50 DMA on higher than average volume …

We may see a test of the breakout, so look to put on bullish strategies on a correction towards $22.5 with a stop loss on a close below $22.12 …

 

I think the best value for the next month is to put on a bullish one-month month call spread …

Consider purchasing a $SLV 13/13.5 call spread to Oct. 08 for $.15 to $.20. This is an excellent risk/reward with a high probability of success.

Bring It Home

The trades I have been recommending are designed to get out in front of the “transitory inflation” narrative, which I constantly said is B.S.

Now the Fed has put itself in an even tougher spot

With growth slowing, the central bank may have to continue to let inflation go and the dollar decline, which means commodities will become overvalued once again.

Jump on these new positive trends in undervalued energy and metals and stay ahead of the crowd.

Have a great holiday weekend, and as always …

Live and Trade With passion My Friends,

Griff   

 

Is The Fed Preparing For A Slowdown?

Hey There Income Hunters,

In case you missed my Griff’s Picks show in our Volatility Edge program yesterday at 1pm … I wanted to share the details …

J-Pow has been adding 30% more reserves to the banking system, even though he has been talking about draining reserves for weeks …

Check this out … This data comes right from their reserve balances … 

Now, the Fed had stated that their amount of quantitative easing (QE) would be $120 billion per month … 

However, it has been much greater …

Could J-Pow be building a cushion before they do start tapering in November? Anything is possible because QE is their only monetary tool they have left. Rates are at zero, and if they sense trouble in the credit markets or the economy all they can do is increase QE.

The Powell Christmas Massacre May Be Repeated

The timeline the Fed has constructed for tapering at the end of this year is eerily similar to 2018.

Powell was also at the helm in 2016, which is when he started tightening by reversing QE, and raising interest rates. It seemed absurd at the time because gross domestic product (GDP) was barely above 2% …

The recovery from the great financial crisis was the worst in history, and he started draining liquidity … So, by October, the Fed Funds interest rates had risen by 1%, and the stock market started selling off.

J-Pow just kept raising rates anyway, and then in early December, it started melting down and by Christmas Eve the S&P 500 (Ticker: SPX) was down almost 20% for the month

Check out this meltdown:

Powell then came back after Christmas, and said the Fed would stop raising rates, but by then the damage was already done.

The takeaway here is that until the Fed and Government can create real economic growth. They should not attempt to drain liquidity from the system.

 Watch the Jobs Market

Yesterday marked the official ending of the unemployment benefit checks … Now we will see the real condition of the job market … Notice the current state of the participation rate …

15 million prime workers now have to look for jobs. The labor participation rate will rise, but will there be enough jobs to move the unemployment rate much lower?

If there isn’t, then the unemployment rate will rise. Right now, it is sitting at 5.4%, while it was 3.5% pre-COVID.

If it does rise, the Fed will have the cover to avoid tapering … The bottom line is the Fed does not have the latitude to reduce much of the liquidity they have already added …

The consumer and the economy are much more fragile now than they were in 2018. Stimmy checks are history, and the spending bills up for approval will not do anything for the consumer.

No tapering and more spending can only mean one thing …

Sell the Dollar

I think will continue to go down for two reasons:

      • One is the Fed has turned more dovish just as other central banks are turning more hawkish, like European Central Bank (ECB) and China.
      • Second, and potentially a much more powerful force, is the Afghanistan disaster. It could trigger a loss of confidence in the dollar worldwide  …
        • We have already seen a number of countries shifting away from the dollar, and exiting Afghanistan may perpetuate similar moves.
        • It did not take China long to reach out and set the tone for trade deals and support for Taliban, and they have $3 trillion in dollar reserves for sale as they set up trade deals in Yuan …

Set up bear strategies in the US Dollar Currency Index (Ticker: UUP) …

Implied volatility (IV) is at the lows, so I like buying the Oct. 15 25-strike puts … I paid $0.31 for the puts. 

You may have your own ideas on how to play it; however, from a macro and technical perspective the trade could reach the recent lows and provide 100+% returns.

If UUP closes back above $24.90 you can stop yourself, putting the risk/reward in your favor …

Bring It Home

September could be an interesting month. Can a reopening lift the economy and bring the US back to the accelerating growth and inflation economic condition of Q2? 

I think it is a toss up at this point. However, if the Fed repeats the mistake of 2018, and tightens too soon … that may kill any chance for an economic recovery …

A bearish dollar strategy is a great short-term play since Powell has made his dovish pitch, and we should see weaker economic numbers in the weeks ahead.

And of course, if you find yourself wanting to play more trades based on government shenanigans, Frank and Andrew specialize in the Deep Information Washington trades that other traders don’t have the resources or intel to find.

They closed out a partial win on Kroger (Ticker: KR) yesterday for a +50% win, and you can join them until midnight right here.

Good luck, and as always …

Live and Trade With passion My Friends,

Griff

 

 

Supply Chain Issues Not Going Away – Sell TLT

Hey There Income Hunters,

 

Money supply growth continues to rise and there is a new force at work that may ignite inflation higher and for longer.


What is it?


That cost of shipping goods around the world.


Reports last week outlined that manufacturers have been forced into bidding wars for space on vessels. This desperate competition has pressured the Baltic Dry Index, which measures the price of moving raw materials globally, into the stratosphere:



The realization of continued inflation will have an impact on bonds and now looks like good timing to set a short in the iShares 20 Plus Year Treasury Bond ETF (Ticker: TLT).


***

Just as supply chain issues can impact your trading, so can the power plays being made in DC. And no one is plugged in behind the scenes inside the Beltway like Option Pit’s Frank Gregory.


But he’s not using that Deep Information at some monolithic hedge fund. No, Frank has teamed up with Andrew Giovinazzi to work directly for you in their Capitol Gains program.


Frank’s connections plus Andrew’s trading expertise have delivered three 50%-plus winners since the Capitol Gains launched a month ago.


And membership has been reopened for a very limited time.


Banks Are Choking on Financial Assets 


The Fed continues to do at least $120 billion a month in quantitative easing … that is useless and just sits within the banking system:


All the Banks can do is sell securities to the Fed when they come knocking and then buy more in the Treasury auctions to load up for the next round …


Well now the Fed is throwing a wrench in those plans by teeing up their taper strategy, when they’ll reverse QE and SELL bonds to the banks to drain reserves from the system.


Judging from the chart below, the banks will not want to buy many bonds in auctions if the Fed is also going to be selling them bonds …



So, we have banks overflowing with dollar assets as we enter a Fed policy shift to sell banks securities.


Treasury Supply Schedule for Next Week


Labor Day weekend is coming up, and the shortened week will add to the difficulty for investors to absorb the bond issuance …


Next week, investors will be bidding on $61 billion in 3-years (Tuesday), $38 billion in 10-years on (Wednesday), and $24 billion in 30-years on (Thursday) …



With all the uncertainty on the Fed taper and inflation, bond prices will be pressured and TLT is an ideal ETF to sell because it matches up with 10-year and 30-year maturities.


TLT Technical Setup 


TLT is in a short-term downtrend with a downward sloping 200-day moving average.vI would like to see a solid break of the 50 DMA on higher volume to confirm bearish trends in all time frames.


With the supply next week, however, I think the risk/reward is favorable to play the trade with a tight stop above 150. On the downside I think 146 to 146.50 is reasonable.


I purchased a 149/147 put spread to the Sept. 10 expiration for $.77 and will add either on a break lower or a spike higher on Fridays nonfarm payrolls.


This is an opportunity that puts the probabilities in your favor.I have put half a position on now.


Bring It Home


The TLT auction setup trade has been working well over the past couple of months as the inflation scare puts pressure on bond prices.


Live and Trade With Passion My Friends,

Griff

Junior Miners Killed it Yesterday

Hey There Income Hunters,

J-Pow tried to knock us out with his hawkish/dovish two-step, but he could not keep a good portfolio down.

Griff’s Picks from last month took a bit of a licking initially, but the overall portfolio is now positive since inception …

Grande Portage Resources (Ticker: GPTRF) topped the list yesterday with a +11.7% day. GPTRF is a high-grade gold mine in Alaska that has a good shot to become a much larger facility …

Their recent new findings were very reassuring, and they could deliver a high multiple if the mine lives even partially up to management’s expectations.

Now, we just need the SPDR Gold Trust ETF (Ticker: GLD) to break out above the 200-day moving average on good volume to bring in institutional buying.

Today I’m including the Griff’s Picks results to date, plus giving you a new player that could easily 10X your investment and is worth a small bet for huge rewards.

More on that in just a minute, but first …

I, of course, will update all news on my miners in Power Income, so keep a look out for that.

PLUS I have a new round of Griff’s Picks ready to roll, with the first one set to be released LIVE Thursday at 1 p.m.

If you’re interested in getting in on these exclusive plays — and getting the entire Volatility Edge Quarterly+ at a great price — pick up the phone and give our Customer Care team a call at 1-888-872-3301 starting at 9 a.m. today. 

I will be focusing on currencies and commodities this time around and may throw in a couple of bonus miners.

The Miners Sweet Spot Portfolio

My miner selection process is designed for minimum risk and maximum reward.

I only purchase miners with proven results that their mine can produce assets. This is the point known as the “orphan period” when companies have shown initial positive drilling results.

At this point, they are still under the radar awaiting official feasibility studies. That period is the lowest risk/highest reward period of the entire mining cycle.

Investors have a chance to make as much as 5-10x their initial investment when investing during this time period.

Here is the full cycle with the second red oval offering the ideal risk/reward ratio for investors …

Griff’s Picks Volatility Edge Miner Portfolio

As part of the Volatility Edge program, in July I selected 6 miners that are in their pre-production zone and are undervalued based on initial drilling results.

During the next couple of years, we could see a number of them get bought out by the big boys like Freeport McMoran (Ticker: FCX), Newmont Mining (Ticker: NEM) or Wheaton Precious Metals (Ticker (WPM)

Swing for the Fences With Reyna Silver (Ticker: RSNVF)

Reyna is potentially a big prize and they’re talking the talk.


“Everything tells us this is the biggest carbonate replacement deposits (CRD) system in Mexico,” top Reyna geologist Peter Megaw said.

The company drilled the first set of targets and is awaiting the assay results, which should be out the week of Sept. 7

This is a big land package (over 11,700 acres), so the first drills are more about triangulating where the source is, rather than how much silver might be in these first holes. That’s what we’ll want to watch for in the upcoming press release about the results of this drill program, which is something the average retail investor may not completely grasp related to how the results get the company closer to pinpointing the source …

Go Big or Go Home

I like this pick because we won’t have to wait long to see if management is correct in their expectations.

However, you should only invest what you are willing to lose … This could easily be a 10-bagger, but it can also be a loser.

I am buying 200 shares. $120 bucks to win $1,080 is well worth the outlay.

Bring It Home

To keep an eye on the mining stocks in the portfolio and view all trades in Power Income, go to OptionPit Trading Records.

As always …

Live and Trade With Passion My Friends,

Griff

 


Fade These Crowded Trades

Hey There Income Traders,

After J-Pow, once again, doubled down on transitory inflation and did the moonwalk on draining liquidity, stocks and commodities got a nice boost.

But you didn’t need Powell’s words to know what to do.

The reversal in the US Dollar Index (Ticker: DXY) a week before Powell spoke was the signpost for a move into stocks and commodities …

If you were ahead of Powells consensus narrative, then you are sitting on some nice profits.

How will you know when to take them?

That’s easy: when the consensus narrative shifts from transitory to longer-term inflation.

Today, I will share the data that is critical to maximizing profits and how to generate new profits by trading contrary to the crowded, general consensus positions.

Copper Reacts to the Dolla’rs Every Move

Smart money doesn’t need J-Pow to let them know when to be long or short inflation (meaning long commodities and short the US Dollar).

The US Dollar is all they — and you — need to follow.

Notice the two highs in the US Copper Index ETF (Ticker: CPER) were triggered by lows in the DXY

Forget about waiting for J-Pow to speak before getting in and out of the commodity complex …

J-POW has never understood how the market actually works. He simply uses his powerful words in hopes of swinging the consensus narrative in the Fed’s preferred direction.

Let the market tell you where the money is flowing.

The Brazilian Real Tells the REAL Story

The Brazilian real is a critical signpost to watch as a trigger to higher and longer inflation.

Brazil is a key trading partner for China, who imports everything from wood, iron and steel to meat and grains.

Historically, the real rises when the dollar is weakening and vice versa …

Watch the 5.17 level on USDBRL. On a breakdown of the USD lower compared to the real, I will add to or build additional bullish commodity strategies (i.e. long silver and short dollars via the Invesco DB US Dollar Index Bullish Fund (Ticker: UUP)).

Monitor Net Long Positions

I frequently talk about fading the consensus trades, meaning going opposite of crowded trades that can reverse quickly because the majority of investors are all betting the same way.

The calculation used to measure investor net long positioning is the standard score, often referred to as the Z-score. The Z-score measures the number of standard deviations the current net long position is away from the mean over a set period of time.

The table below shows the Z-score results calculated from the mean over one year. A Z-score of +2 or -2 standard deviations is indicative of extreme net long positions.

For example, a -2 z-score represents an extreme short in relation to the mean over the past year …


Notice the dollar position Z-score shows an extreme long, while oil, copper and silver show extreme shorts.

This is important internal market data that reveals counter trading deflation trades (i.e., short commodities and long dollars is a position that offers a higher probability of success).

Until we see investor net long results shift back towards the mean …

Bring It Home

J-POW’s words will move markets less and less as time goes on.

Rely on market internals to give you an edge in trading …

Personally, I am long puts in UUP and long call spreads in the iShares Silver Trust ETF (Ticker: SLV) and SPDR Gold Trust ETF (Ticker: GLD).

This Thursday I will share more details on what is driving the commodities and dollar and trading levels in the short and longer-term …

Subscribers to Volatility Edge automatically receive the five picks I will share each Thursday in September (starting this week). while Trading Legion members have access to my weekly Macro Monday outlook.

Call our Customer Care team at 888-872-3301 to find the right fit for you and let’s get to work as the market begins a powerful trend into the year’s end.

I look forward to helping you crush it. Until then …

Live and Trade With passion My Friends,

Griff

Charts and Data that Matter this Week

Hey There Income Hunters,

J-Pow’s message during the Jackson Hole Economic Symposium had a more supportive tone for the markets and stocks, which bonds and commodities loved.

The S&P 500 and Nasdaq made new all-time highs, while commodity, metal and miner prices continued their renewed resurgence.

My take on J-Pow’s message is two-fold:

      • He will maintain a bit more patience before starting the Fed’s taper program to scale back the $120 billion monthly bond buying program.
      • A recent dot plot that showed an earlier start (2022) to raising interest rates will not be realized and the original 2023 — at best — date is more realistic.

This update from J-Pow was also good news for my bearish US Dollar Index (Ticker: DXY) position and bullish metals and miner’s positions.

Significant Signpost

My most important signpost for the 2021 and the next decade is the US Dollar. I am 100% certain the transition to a new monetary system is the macro force that will dominate flows for years to come.

The short-term uptrend has reversed in DXY, with the current price of $92.68 resting just above the 50-day moving average and the uptrend line connecting the higher lows established during the recent rally.

DXY

As a proxy for DXY, I am long the Invesco DB USD Index (Ticker: UUP) 25 puts expiring on January 21, 2022.

My plan for this week is to add to my put position on a break of the 50 DMA and trend line on high volume. Notice the above-average selling volume over the past few sessions. I think this renewed downtrend will continue.

Physical Gold

Once again gold is breaking above the 200 DMA. Could this be the break-out to new highs by the end of the year?

There are a few positive stimulants that will drive gold higher in the months ahead. The big one is the fiscal spending, which will be driven by the infrastructure bills.

Next is the 10-year real rate of interest that historically drives Gold prices. The real rate is the 10-year yield minus the consumer price index (CPI).

The inverse correlation has diverged recently, but I believe J-Pow’s clarification on the Fed’s patience re: raising rates will propel real rates lower and gold prices higher.

Third, the dollar will be the most powerful force and, as mentioned above, I believe the dollar is entering a renewed down trend

SPDR Gold Trust ETF (Ticker: GLD)

GLD is a very liquid ETF with liquid options. As you can see below, Friday’s trade attracted much higher than normal volume …

I think there is a high probability for GLD to break out above the 171.50 area in the next couple of weeks …

I am long the GLD 175/185 call spreads to Jan. 21 as a proxy for physical gold. I am confident that GLD will take out the high established in early June at 178.80 by year’s end.

Bring It Home

Key Fed decisions can be turning points for trends, and I believe that is exactly what Friday’s speech and the flows represent — a renewed downtrend for the US dollar and the breakout for gold.

#Income Hunters sense when there is an opportunity to bag a nice kill. This is one of those opportunities.

Stay tuned, and as always …

Live and Trade With Passion My Friends,

Griff

Easy Income via Crypto Staking Rewards

Hey There Income Hunters,

 

A passive income business that could offer you a tremendous quality of life in or out of retirement sounds pretty great.

 

Well, one of the biggest benefits of owning crypto is the ability to participate in delegated staking rewards, which are similar to owned-stock dividend distributions — yet can be much more lucrative than the average returns gained from dividend income.

 

Did you know that there is currently $200 billion dollars invested in Crypto staking rewards? And since the probability of below average equity returns over the next 10-years is high, you must consider diversifying into the big business of crypto investing and staking rewards.

 

Today, I’l give you the how, where and why of staking.

 

The How of Crypto Transaction Validation

 

Most cryptocurrency projects are built on open decentralized platforms that avoid third party intermediaries.

So, validation of transactions is done via blockchain technology, which stores transactions on a digital ledger.

 

There are two consensus mechanisms that provide the necessary validation of digital transactions over blockchain:

 

      1. Proof of Work (POW): This is the process of mining. Miners use computing power — and lots of it — to solve complex equations that ultimately validate transactions over the blockchain network … This is a resource-intensive process due to the amount of energy required. Examples of POW are Bitcoin, Litecoin and Ethereum (first iteration) just to name a few
      2. Proof of Stake (POS): POS uses smart contracts, which delegate movements of the digital coins into a blockchain “safe.” This process is 99% less resource intensive. POS is a much more efficient mechanism validating transactions. Also Cardano, Polkadot and Binance validate transactions using the POS mechanism.

 

The Why of Staking

 

This is very important to understand because staking is a game changer for decentralized finance.

 

      • Staking is the use of coins instead of computing power in the consensus mechanism process.
      • The aggregation of coins used in a transaction creates new blocks on the blockchain. The new blocks are simply built instead of mined. This makes the process mechanism extremely efficient from an energy use perspective.
      • Lastly, stakers earn rewards similar to miners. Miners create new coins and earn rewards for their work … Stakers create new coins, stake them and earn between 1% and 20% annualized return, and can also compound those annual returns as often as weekly. This is a very powerful way to create generational wealth … …

 

The Where for Staking

 

      • Exchanges: Staked coins may be stored at exchanges like Coinbase, Binance and Kraken, as well as many other custodians who service cryptocurrencies.
      • Wallets: There are private wallets that allow you hold the private keys to your wallet. This storage eliminates counterparty risk — no one can touch your coins if you hold the private keys …

 

You simply delegate your coins to the exchanges or your own private wallet and they are aggregated into a pool. The larger the pool the more you can earn …

 

The Coinbase wallet app offers this private key facility and only you have access to the coins held there. Others offering a similar service are Ledger and Trezor.

 

Remember, if you don’t own your private key, you don’t privately own your crypto and are at risk of hacking and losing your investment.

 

Example of Staking Polkadot

 

The Polkadot crypto project enables cross-blockchain transfers of any type of data or asset, not just tokens. This is a critical feature as more and more blockchain networks are added to the universe.

 

Once you exchange your dollars for Polkadot coins, you can delegate your coins to your private ledger, for instance Ledger Nano S is a private hardware wallet you can store the coins on …

 

Key Features of Staking Polkadot Coins

 

      • You can earn 12+ annualized returns by staking your Polkadot coins 
      • You can choose compounding your rewards every 3 or 4 days or to receive the rewards into your spending wallet 
      • You have unrestricted access to your assets and can unstake at any time.

 

This is a real income stream. You can use it to supplement your income and pay your essential goods and services on a monthly basis …

 

Bring it Home


Income hunters need to think outside the box … cryptocurrencies and decentralized finance  WILL revolutionize society and finance as we know it.

 

Get involved with a small portion of your investable assets to gain confidence in the process and prove the distribution of rewards into your private wallet.

 

The benefits are twofold … You invest a portion of your paper dollars into a decentralized digital currency and you earn much greater returns than you can in US financial fixed income assets.

 

I will be bringing you much more on the opportunities available in the crypto space.

 

Until then …

 

Live and Trade With Passion My Friends,

Griff

Bitcoin Going for Gold?

Hey There Income Hunters 


For weeks, gold has underperformed relative to its historical indicators.


Gold is down 8% year-to-date, while CPI is up 200%


In the industry we have a term for this …


WTF?


Meanwhile, Bitcoin is up +43%.



Could it be that the Bitcoin market is now big enough to steal market share from gold?


It may very well be.


Bitcoin Bigly


Bitcoin now has a combined $2 trillion in crypto market cap and it’s open-source Lightning  network continues to grow rapidly. The platform offers payments and data sharing, but the cool thing is it does not offer a separate token, which means it is not for speculation.

Nigeria, Guatemala, and El Salvador are all integrating the Lightning network into their local Bitcoin App. This solution has proved to be an upgrade from receiving payments from Western Union, and it comes without the fees.


Twitter (Ticker: TWTR) is considering integrating Lightning, as well. Square (Ticker: SQ), another company owned by Twitter CEO Jack Dorsey, has already integrated Lightning into its cash app.


Bitcoin Technicals


Bitcoin (Ticker: BTC) futures traded on the Chicago Mercantile Exchange (CME) held the 50-day weighted moving average and are trending higher once again.


Any pullback to the $40,000 area would be a great buying opportunity …

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Without more serious regulations, BTC will make new highs before the end of the year.

Where Does This Leave Gold

I have said many times that Gold’s true value is as an alternative currency to the dollar, and other major currencies, more than as a hedge to inflation. In fact, I believe this now more than ever


The dollar is the tell when money will flood into Gold. Notice the Dollar Index (Ticker: DXY) and how closely gold has tracked DXY after Covid hit in March of 2020 …

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The bottom line is, gold will ultimately soar when our global trading partners begin selling dollars and bonds because they realize the dollar is losing its reserve currency status.


Bring It Home

Gold and Bitcoin will coexist as two safe havens for a failing dollar and other weakening global currencies.


Once the meltdown occurs — though there’s no surefire way to say when that will happen — there will be massive flows out of financial assets into gold and bitcoin.


Gold will play a role in the transition to a new monetary system and when that notion becomes widely accepted (and it will) gold will do some catching up …


True #IncomeHunters are diversifying into BTC, GLD and miners because they, like me, believe there is a good chance the big rally in both could happen before the end of 2021.


Until then …


Live and Trade With passion My Friends,

Griff