February Gold is up $1.80 at $1145.20 this morning as I write. The included chart shows that gold is still in a long term secular bull market. Let’s not forget that. Near term, gold is having a much needed correction off the highs following a $200 per ounce rally over the past month. Gold prices are approaching the 40 day exponential moving average and a 50% correction of the $200 move. My suspicion giving the speed of the latest rally and the ensuing fallout, that gold prices have probably seen their highs for 2009, and that prices will continue to correct and consolidate until the end of the year. But, don’t forget that the long term trend is up and it could reinvigorate itself at any time. The directional movement indicator has crossed to the bear side and the ADX line continues to fall from the overbought levels mentioned over a week ago. On more price selloff’s and more time erosion, I will eventually be recommending to buy back some of the short call options we have written on the April gold. Stay tuned.
Long 2 February Gold ($960 strike) put options at $10.40 each.
Long 2 February Gold ($970 strike) put options at $10.60 each.
Long 1 February Gold ($1140 strike) call option at $23.90.
Short 1 February Gold ($1180 strike) call option at $16.90.
Long 1 February gold ($1270 strike) call option at an average cost basis of $5.00 per ounce.
(February Gold options expire in 48 days).
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Long 1 April Gold ($1210 strike) call option at $33.00.
Short 2 April Gold ($1300 strike) call option at $17.50 each.
Long 1 April Gold ($1275 strike) call option at $17.80 per ounce.
Short 2 April Gold ($1400 strike) call options at $9.90 per ounce each
Long 1 April Gold ($1375 strike) call option at $11.80.
Short 2 April Gold ($1500 strike) call option at $6.90 each.
(April Gold options expire in 106 days).
David Hall
The information and opinions contained herein comes from sources believed to be reliable, but are not guaranteed as to accuracy or completeness. The risk of loss in trading futures and/or options can be substantial. Each investor must consider whether this is a suitable investment. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results.
This newsletter is not intended for dissemination to the public without prior approval from David Hall.
