Gold Trading Alert #2: SPXL, FCX and the Rest

We just took profits from SPXL – congratulations on this quick trade!

Today’s intraday high was $122.98, and our profit-take level was $122.88.

I wrote to you that it was a quick trade, and indeed, it’s now over in less than a week. The entry was $109.63, which gives us a nice 12.1% profit – pretty good for less than 4 full trading days, don’t you think?

Is this the final top for this corrective rally? My best bet is that we might get even higher tomorrow, but I also think that the easy part of this rally is over. And given a strong medium-term downtrend and the likelihood that the 2008-style slide is starting, betting on counter-trend moves is risky. So, I’m very happy to be profitably out of the market after the easy part of the rally, while getting ready for another short trade.

The next shorting candidates are FCX and silver. I’ll provide more details soon.

Why do I think that the markets might rally further tomorrow? Because Trump’s 90-day pause on tariffs for most countries will likely be something that other stock markets rally on tomorrow and this would be likely to take the US stocks / commodities even higher.

Today’s intraday high in gold futures was $3,116.76 – less than $7 above the upper border of my target area. This might be it for this corrective upswing. Alternatively, we might see a second top, like we saw in 2011, but the former seems more likely to me. As I wrote previously, I’m not shorting gold here, nor do I plan to do so.

Anyway, I’ll get back to you with details of new short positions soon.

Once again, congratulations on your just-in profits in SPXL.

Thank you.

Sincerely,

Przemyslaw K. Radomski, CFA