Buying Coast Wholesale Appliances Inc. (CWA), Market Update, Gold and Silver Update

Coast Wholesale Appliances Inc. trades in Canada on the Toronto Stock Exchange, and is currently paying a 9% dividend. 

Equally compelling to us is that a long-term downtrend appears to be broken. 

Here's the long view:

If the stock closes below the red 4-year uptrend, we'd be worried.  Currently that trend line is around $2.50  A possible resistance trend is shown in black, currently around $4.65 

The breaking of the green line is our "go" signal, so we're buying CWA. 

Admittedly this is a bit ironic given the news we linked to Monday about weak U.S. durable goods data, and it's no different in Canada.  We expect consumer demand to continue to wane, and that'd be just one of so many reasons why this or any consumer goods stock could drop.  We can't know what will happen in the future, however we do know that currently the dividend is fat and the technical setup looks great. 

Here's a closer view of that technical setup:

Market Update: Holiday weeks often end to the upside. Support on Tuesday should be found between 14800-14900 in the DJIA, or within the broad range between 14550-14750 in the event of a more material drop.

Gold and Silver Update: We had been accurately and profitably bearish gold and silver, particularly earlier this year, while virtually everyone else was rabidly bullish. Then while the world was selling in panic in mid-late June, we were virtually alone in turning temporarily bullish on gold and silver for the first time in two years. 

We posted a few times in that time period that we were loading up on AGQ (levered silver ETF) and GDX (gold miners) calls.  Those calls are now up many hundreds of percent, and we're booking most of those profits while keeping just a few calls longer-term which are now effectively cost-free. 







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