Our gold trade is a bit early but the long side is so crowded, we are staying with our shorts.
While the stock market has reached the upper end of its trading range, we have conflicting scenarios:
The volume hasn't come back perhaps because the individual investor is through giving his money to the game. (At least the stock game - they are throwing it away in huge numbers to bonds - soon to be highly disappointed).Will this lead to an eventual war of the big dogs attacking each other. The game must go on but if the retail investor does not come in, which we believe they won't then the big boys will turn on each other creating a monster sell off.
or
The market will keep pushing higher in spite of the worsening technicals still believing the retail customer will be there for the institutions to unload their positions.
We like the first scenario. We are staying short, selling call spreads into this rally, on gold and SPY. Buying dollars and UUP.
