China not-so-surprised the market (their delayed Treasury report was a hint) with a 0.25% rate hike overnight (WSJ: China Raises Interest Rates). The US Dollar shot up, precious metals took a big hit. I close my gold short soon after the TSX market open to collect some quick profit. Rinse and repeat. I did mention that this trade is a short term swing. I bought this Horizons BetaPro Gold Bear Plus (HGD.TO), a leveraged gold short, on Friday and unloaded it this Tuesday. I fought against my greed to hold just a little longer. But the ascending support line on gold is too obvious to ignore (Fig. 1). Thus I closed this short term position with this 5%+ gap up while the market is still deciding what to do. Furthermore, I noticed the equities market are holding rather well at the open. S&P500 held onto 1170 price level. Asian markets were marginally green overnight. And even the CAC in Europe is fighting an intraday low as the North American markets open. Thus, the sky is not falling just yet. I figured it would take more omph to push this market further down as we are indeed in a strong bullish move. At the very least I am expecting some retaliation from the bulls. This can't be this easy for the bears, can it?
[caption id="" align="aligncenter" width="570" caption="Gold"][/caption]
Net profit for this trade is (\$10.84 - \$10.27) * 350 = \$199.50 - \$9.90 commission = \$189.60 = 2% of account.