GST Issue #212
Dear Member,
Looks like my models have been right on the money, as gold has now taken a beating, plunging to the $1,170 level.
As a result, gold remains on track for a June low, which could see gold fall to as low as $1,000, perhaps even lower.
No time to waste, I recommend adding put options on the SPDR Gold Trust. Details below.
If you are not trading options, as an alternative you may purchase another 200 shares of the DB Gold Double Short ETN (DZZ), with a protective sell stop, good till cancelled, at $6.43, the same as the initial position in DZZ.
Please note: A bounce can happen at any time. But with gold so weak now, it does not pay to try and wait and catch a bounce.
Therefore, though I recommend put options now (or more shares in DZZ), don’t be surprised if initially the position moves against you.
For put options on GLD, I recommend the July 2015 puts with a strike price of 114. These are slightly in the money puts, and have plenty of time to go to catch a big down move in gold. Here are the details:
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For each $25,000 you are trading in this service purchase either: 1. Buy 8 July 2015 GLD put options with a strike price of 114, symbol GLD150717P00114000, at a price of $4.00 or better, to open. OR … 2. Buy 200 additional shares of the DB Gold Double Short ETN, symbol DZZ, at the market. Place a good till canceled protective sell stop at $6.43 on all of your shares. |
Hold all positions and related stops, and stay tuned.
Best wishes,
Larry
