How about gold, folks!? When we dipped down around 1520 I called it a bear trap, and I warned people not to get caught in short positions. Now, over the last four days, we’ve seen gold bounce up around $90. Incredible!
As a long-term gold bull, I was very eager to take advantage of that pullback and get into a long position. So I brought Greg Hadley of Bull & Bear Institute on the show. Greg walked us through a wonderful high-probability trade—a 15-16-17 fly—that turned out to be a real winner.
So now that we’re in the money, I asked Greg back on this morning to find out what he’s doing next.
Like me, Greg still maintains his upward bias. And he still has a lot of upside wiggle room in that trade. Since he doubled up on his initial position (long two 1500s, short four 1600s and long two 1700s—all calls), he’s taking half off while the shorts are in the sweet spot. That will give him around a 4-1 return—enough to pay for this trade and the next one too. Meanwhile, he’s holding on to the other half of his position, looking for a chance to make even more money down the road—remember, we’re talking about April strikes here.
Every once in a while you have to pat yourself on your back when you make a great trade, and, like I told Greg, this is absolutely one of those times. A brilliant high-probability trade where we always know our exact risk-reward ratio—and the timing couldn’t have been better. This gold trade is just another in the long list of reasons why I’m so glad I came across the Bull & Bear Institute. I aim to be a good steward of information, and they bring that same philosophy to each and every one of their classes. Heck, I’ve been in the markets nearly 30 years and I’m still learning things from them!