There’s no question a lot of investors are about to get caught in the gold and silver market. They jumped on the first rally with reckless abandon … they have big dollar signs in their eyes …
And they have forgotten the cardinal rule of bull markets: What goes up, must eventually pullback, test support, and prove itself as a real bull market.
You caught some modest gains grabbing the last leg up with shares in UGLD and USLV.
But now, look at what my models are forecasting: It’s pretty clear from the artificial intelligence output.
Yesterday (March 7) was the ideal day for the top and coming next should be a steady decline into late May – one that brings gold all the way back down to as low as the $1,100 level.
Keep in mind that there is always some statistical variance in my models. In other words, while yesterday was the ideal top for gold, it would not be unusual to see gold move higher for another day or two before succumbing to the bearish cycle that is forthcoming.
Either way, the strategy here is clear: Grab the modest gains on UGLD and USLV.
Then, I recommend reversing to a bearish position for gold and silver, but officially via options, to get the best leverage.
Don’t worry, I’ll also recommend the alternative ETFs. (The official tracked results for the service, however, will be for the options).
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For ALL Members: 1. SELL ALL of your shares of VelocityShares 3x Long Gold, symbol UGLD, at $12.39 or better, good till cancelled. When filled, cancel your protective sell stop at $10.43. 2. SELL ALL of your shares of VelocityShares 3x Long Silver, symbol USLV, at $13.65 or better, good till cancelled. When filled, cancel your protective sell stop at $10.35. 3. Using 4% of your trading funds, buy the May 2016 SPDR Gold Shares, symbol GLD, put options, strike price 118.00, symbol GLD160520P00118000, at $3.00 or better, to open. This order is good till cancelled. 4. Using 4% of your trading funds, buy the May 2016 ProShares UltraShort Silver, symbol ZSL, call options, strike price 50.00, symbol ZSL160520C00050000, at $4.50 or better, to open. This order is good till cancelled. NOTE: GLD is a bullish ETF on gold, so to make a bearish play on it, you want to buy put options on GLD. Conversely, ZSL is an inverse bearish ETF on silver, so there you want to buy call options on ZSL to leverage the gains ZSL would experience if silver declines. Alternatives for Members Not Trading Options: A. Using 4% of your trading funds, buy ProShares UltraShort Gold ETF (GLL) at the market. B. Using 4% of your trading funds, buy ProShares UltraShort Silver ETF (ZSL) at the market. NOTE: I will not give you protective sell stops for these ETFs. Instead, follow my strategy for the options. When I exit the options, exit your ETFs (unless I tell you otherwise). |
Hold all other positions and related stops and stay tuned.
Best wishes, as always …
Larry
