Midway Gold update

In this post I began modeling about MDW (Midway Gold) simply because infamous pump and dump genius Jonathan Lebed has been pumping it in his free spam emails.   If all that sounds derogatory, it's really not meant to be.  Yes he is kind of a bottom dweller but so are ALL of the highly respected Wall St banker con men.  I just happen to like his more open viewpoints and I also think his sense of timing is pretty good.

But the boy should learn something about Elliott waves.  While my post indicated that a large pullback was eminent, he was claiming "new high eminent" on the same day. His email today is more of same:


"Midway Gold (MDW) rose from my speculative rating of 1, highest level of confidence pick price of $1.21 up to a new 52-week high of $1.44 for a gain of 19% - but is currently back down to $1.21! I'm sure MDW's low of day of $1.20 is the bottom - and MDW will explode back up to new 52-week highs in the upcoming trading days! . "

While he is pumping for new highs immediately, I model that the support line below will likely break down.  I think it will test it, bounce and then gap down through.  I model it as going down to the prior 4th wave which is at about $1.00-$1.04.  That is best case. 

Alternatively, this also might be treated as an ending diagonal retrace in which case it could go all the way back down to re-test the down sloping green line.  If it gets down there and holds support then it will be one of the most lucrative purchases you have ever made.  Treat it as you would a nonexpiring option at that price.  Treat it as an asymmetrical bet (i.e. small investment) which has a huge chance of paying off because as the broader markets begin to fail, Yellen will print more money.  It's all the b#$%^ knows.  That might slow the decline of the broader stock market indices but it will absolutely SKYROCKET the massively beaten down miners.  Going long the junior miners will be a better, safer play than shorting the markets via FAZ or TVIX.

Still, the title of that original post was "I like MDW".  There was a reason for that even though I was short term bearish on the shares.  I don't give free investment advice but if I did it would be to wait for the metals to play out the ending diagonal that I have defined and then jump into so of these micro cap miners.  I am talking possible gains of at least 10x (1000%) and perhaps as much as 20x if you can catch the exact bottom of the dip (20x gain assumes that the red line might not hold and that a full back test of the lower green line occurs, 10x gain assume that support is found at $1.00).