Thanks also for your concern about my potential losses from shorting another parabola. I forget once in awhile that long-term options are the instrument to use for betting against a parabola and try shorting futures. But then I remember and buy some puts. The GLL calls I bought represent about 1/3 of 1% of my trading capital. If the precious metals continue higher I will probably put on another similar sized positions in ZSL calls, as silver is the much weaker market. I may go all the way to a 2% position before I'm done. I've made good money shorting parabolas in the past (with long-term puts), starting with Coleco and the Cabbage Patch Doll mania back in the early 80's, and more recently with gold, platinum and crude oil last year. Of course it may not work this time and I may lose money, but one cannot trade if they aren't willing to risk money.
The bottom line is, nothing has changed. The pundits and participants are at maximum bullishness, but only after the gold market has been running up for 8 years and has now gone parabolic. I don't rule out a run to 1350, 1500, or even 2000 here. On the other hand, it may not get over 1220. Who knows? However, I don't think it makes it past Jan/Feb time frame, if that long, before collapsing. BTW, I have a $3400 target for gold long term, but I think it's going to the 650 to 850 range first.
Kimston
Thanks for alleviating my concern about your potential losses.
It looks like you're unlikely to lose, or make much with that position. We've each got our own methods. I trade futures, so my tolerances don't permit me to tolerate a major move against me...and really that's what I was speaking of. Each to his own. I can see some corrective activity, just not anything of the size you're talking about. I'm only playing the long side for now. I'll be happy to let you know when I think the downside is appealing to me.IT
