Thursday, August 11, 2011

Tail end

8:43 am (Hawaii) Instead of waiting for spot gold's margin-induced decline to bottom, I entered DZZ to ride the bear train. I worked for awhile. I entered at 4.94, 4.95 and chased at 4.98 thinking the momentum of today's fall in gold would trigger more selling. DZZ hit 5.00 momentarily, then gold began a rally from 1731 to 1745.

I got out of DZZ at 4.88, my mental stop trigger. I missed the ride down even though I knew the CME mafia's margin hike yesterday would eventually take effect. In fact, I doubt it's the only hike coming. As long as gold rallies back to 1775 or 1800, there will be more hikes. JP Morgan needs more time to accumulate, short, accumulate, short, etc.

I've been using wider ranges lately, but from this point, I'm going to sell earlier like I used to and at least break even if a trade goes against me. It was a very small loss, small position. DZZ is back at the level of 1-2 hours ago when I started watching it at 4.88. I'm guessing gold goes as low as 1700, maybe back to 1660, but only if there are one or two more margin increases. Not interested in re-entering DZZ for awhile. I caught the back end of this move. Smells like the run is done until the CME mafia acts again.

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