In fact do we ever know if a Hog Cycle is over until it’s over?
I think NOT. See GREENSPAN.
However, we all need to know how to act. So, for my part, I have done something simple but highly subjective and let two stocks show me the way!
The commodity I am going to look at here — gold — has a well documented history. Two Australian gold stocks have had protracted share price battles. I have chosen them as good indicators for this very reason.
For PSV I have drawn a line in the sand at A$0.35 cents. At the time of writing PSV is in the green zone above my chosen level and is indicating a continuation.
For LSG I have drawn a line in the sand at A$2.00. At the time of writing LSG is in the red zone just below my chosen level and has not followed the PSV lead, indicating caution. The public, it seems, is reluctant to pay up for gold stocks at this price and time.
The current split position is neutral, so I can wait and see.
If both prices climb above my chosen levels, this would be a green light for the gold stock bulls.
If both prices fall below my chosen levels, I can cash up and look for something positive.
So there we have it, the above has many known flaws. But I do have a simple emotion-free plan of action.
Declaration of Interest: PSV and LSG NULL