Gold Continues Its Slide
We have been all over the gold trade like grass on dirt and with today's $25 drop our downside targets are coming into play. We said after a back test to $1,475, Gold is poised to test new lows south of $1,325. The drop below $1,400 earlier this week was the trigger to go short and today's $25 drop to $1,362 could be the start of another free fall.
We have been following the Spiders Gold Shares (GLD, $131.80, down $2.29) and the June 125 puts (GLD130622P00125000, $1.80, up $0.50) that are getting a nice 40% pop today.
We wanted to get into this trade on the break below $140 but we have been late to the sell the gold party. We will see what the chart says over the weekend but if our projections are right, Gold has further weakness and these puts options could continue to do well.