Tuesday, March 31, 2009

Shorting Gold

Today I decided to go short on gold. For a purely technical reason. As I noted yesterday here, all technicals are bearish for gold. If you look at GLD chart, only support at 90 holds, all bullish support levels are broken: 13 days moving average, 50 days moving average. There is a perfect head and shoulders formation.

Fortunately, it's easy to select a good tool. My choice today is DB Gold Short ETN (DGZ). Of course, I put a tight trailing stop on my position. Bar some big political events, gold should go down from here, but you never know...

Full disclosure: at the time of publication author had a short position in gold by holding DGZ. Positions can change any time.

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