I have been very vocal on the prospects for the Gold market.
Recently I have been accused of being a "Perma bear" on the precious metal. However , my previous comments here on SA state my position quite clearly. I became bearish on Gold when Gold in fact entered a 'bear" market.
The Spike in Gold we saw today was quite impressive and allowed me to scale into a "short" position via the (NYSEARCA:DZZ) a leveraged (2X) ETF
This ETF tracks well with both the metal and (NYSEARCA:GLD) which I am using to "chart' & track my position.
I purchased 1/3 of my position today in DZZ at the close today @ 6.45 & will monitor to add to my position as we move forward.
I will use this as a "short to intermediate" term trade and will employ an "exit" strategy with a 'mental" stop of $5.50 on th DZZ which should equate to a move to 1450 or so for Gold.
That would equate to approx. a 15% downside risk to the trade or a 7% upward move on Gold to 1450.
As of now I believe the 1450 - 1500 range on Gold will provide major resistance . If in fact the metal does overtake the 1500 level, it would appear the bull argument that this was a mere correction is correct and my assertion of continued weakness and bear case is wrong.
I will monitor and update as this trade unfolds.
Disclosure: I am long DZZ.