Long time holder of gold and silver mining positions. Retired.
End of 2024 my precious metal positions (gold/silver/platinum)
represented 24% of my portfolio. Due to parabolic moves, yesterday
they represented about 65%. Wanted to reduce overall
exposure/take some profit. Couldn't be in front of a computer
screen today at the open, knew mining stocks would open higher but
worried they might take a hit today. Opted to place stops while
away on about 7 of my 16 positions using daily candlestick charts
and recent lows. Most were hard stops that fell into the
4.5%-5% category. Sold one position (HL) in its entirety
yesterday for a healthy profit.
6 of the 7 stops triggered early morning in/around where the
stocks closed end of day today. My exposure to precious
metals was reduced by 1/3rd. Though not at the high, profits were
significant on positions sold, so no complaints. Don't know if the
selloff will continue tomorrow or was more of a one day shakeout
similar to what happened earlier this week. I think the latter
because gold and silver prices were up end of today, I assume
stocks will rebound tomorrow or early next week. That may or may
not play out.
So here's my thinking about placing stops on longterm positions
when precious metal stocks go parabolic. The best approach
seems to be EITHER to place a hard stop 6%-7% below current
price (which will limit damage in case of a crash) OR place a
tighter (3%) TRAILING STOP on positions you are willing to close
out. ..knowing you may get stopped out on noise. The 4.5%-5%
scenario I placed seems to be the incorrect approach - one that
often triggers due to a short term shakeout, followed by a quick
rebound in stock price. My conclusion is based strictly on
anecdotal evidence and may be off base. Trying to get better
at this. Any thoughts?
Posted by Soldtoosoon on 29th of Jan 2026 at 06:32 pm
No one catches the top. If they said they did, they're
lying. Probably best to follow what Matt said, and use
a CLOSE below 9 or 10 dma. I hate hard stops,
1. Doesn't the use of any indicator at the CLOSE leave a trader
vulnerable to a major sell off intraday?
2. What is a DMA and what are the advantages to using it vs
either an SMA or EMA?
3. Assuming the DMA fluctuates during the trading day, why is it
better to use vs a hard stop based upon a support level or trend
line? I had the impression Matt often uses hard stops based
upon support levels.
Posted by Soldtoosoon on 29th of Jan 2026 at 11:38 pm
Matt and others are more expert at this, my humble answers:
1. Yes, in the event there's a big down day without any
recoveries in the near or even mid-term future. You are
weighing that against what you just experienced, which is an
intraday recovery. I've been victims of intraday "shakeout"
recovery before. Or as Steve used to call it, "liquidity
grab". The myth was always that when the market maker (or
algo traders) see hard stops, they move the price down to trigger
the stop sales to "grab liquidity", then they move the price up
after taking your shares on the low. I think that's why Matt
likes to see a CLOSING price below your stop point (9 dma).
2. DMA is day moving average. If you're using a daily.
price chart, then the standard moving average is based on day
moving average. so 9 DMA 20 DMA 50, 200.
3. You have to choose your poison. If you choose to use
closing price for the day, then you avoid intraday shakeout or
liquidity grab. If you choose hard stop, then you NEED to be
happy with the price you sold it at. Nothing wrong with that.
You just need to be happy with where your stop was triggered.
If it went up later, c'est la vie. You've made your
money.
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Placing stops on long term precious metal positions
Posted by RichieD on 29th of Jan 2026 at 05:48 pm
Long time holder of gold and silver mining positions. Retired. End of 2024 my precious metal positions (gold/silver/platinum) represented 24% of my portfolio. Due to parabolic moves, yesterday they represented about 65%. Wanted to reduce overall exposure/take some profit. Couldn't be in front of a computer screen today at the open, knew mining stocks would open higher but worried they might take a hit today. Opted to place stops while away on about 7 of my 16 positions using daily candlestick charts and recent lows. Most were hard stops that fell into the 4.5%-5% category. Sold one position (HL) in its entirety yesterday for a healthy profit.
6 of the 7 stops triggered early morning in/around where the stocks closed end of day today. My exposure to precious metals was reduced by 1/3rd. Though not at the high, profits were significant on positions sold, so no complaints. Don't know if the selloff will continue tomorrow or was more of a one day shakeout similar to what happened earlier this week. I think the latter because gold and silver prices were up end of today, I assume stocks will rebound tomorrow or early next week. That may or may not play out.
So here's my thinking about placing stops on longterm positions when precious metal stocks go parabolic. The best approach seems to be EITHER to place a hard stop 6%-7% below current price (which will limit damage in case of a crash) OR place a tighter (3%) TRAILING STOP on positions you are willing to close out. ..knowing you may get stopped out on noise. The 4.5%-5% scenario I placed seems to be the incorrect approach - one that often triggers due to a short term shakeout, followed by a quick rebound in stock price. My conclusion is based strictly on anecdotal evidence and may be off base. Trying to get better at this. Any thoughts?
Thanks for sharing you trading
Posted by gccapital on 30th of Jan 2026 at 08:46 am
Thanks for sharing you trading wisdom, very timely sells yesterday!
No one catches the top.
Posted by Soldtoosoon on 29th of Jan 2026 at 06:32 pm
No one catches the top. If they said they did, they're lying. Probably best to follow what Matt said, and use a CLOSE below 9 or 10 dma. I hate hard stops,
Thanks. Three follow up questions: 1.
Posted by RichieD on 29th of Jan 2026 at 09:03 pm
Thanks. Three follow up questions:
1. Doesn't the use of any indicator at the CLOSE leave a trader vulnerable to a major sell off intraday?
2. What is a DMA and what are the advantages to using it vs either an SMA or EMA?
3. Assuming the DMA fluctuates during the trading day, why is it better to use vs a hard stop based upon a support level or trend line? I had the impression Matt often uses hard stops based upon support levels.
Matt and others are more
Posted by Soldtoosoon on 29th of Jan 2026 at 11:38 pm
Matt and others are more expert at this, my humble answers:
1. Yes, in the event there's a big down day without any recoveries in the near or even mid-term future. You are weighing that against what you just experienced, which is an intraday recovery. I've been victims of intraday "shakeout" recovery before. Or as Steve used to call it, "liquidity grab". The myth was always that when the market maker (or algo traders) see hard stops, they move the price down to trigger the stop sales to "grab liquidity", then they move the price up after taking your shares on the low. I think that's why Matt likes to see a CLOSING price below your stop point (9 dma).
2. DMA is day moving average. If you're using a daily. price chart, then the standard moving average is based on day moving average. so 9 DMA 20 DMA 50, 200.
3. You have to choose your poison. If you choose to use closing price for the day, then you avoid intraday shakeout or liquidity grab. If you choose hard stop, then you NEED to be happy with the price you sold it at. Nothing wrong with that. You just need to be happy with where your stop was triggered. If it went up later, c'est la vie. You've made your money.