ASX crash? (#3)

[contrary]

anyway back to topic

IV, love your posts. Goldfish I like too (but not quite as much as fewer actionable facts). Anyway, back to topic.

Right now I am waiting for more announcements of intervention, a Christmas rally and a good shorting entry point. I don't think I'd buy gold in much scale until a pullback to 1200. If none of these are met, I'm happy to wait.

I may be wrong but it seems obvious that US equities are in a secular bear and gold in a secular bull. But people seem to forget the obvious. The question then turns to what is the best probability long or short and that will depend on your system, preferences and timeframe. You can still be right and lose if you get the direction right but have the wrong timeframe. Or you could be wrong and still win! Another thing people do is overestimate their tolerance to risk or loss. So when things move down 20% they suddenly no longer feel like they can hold. This bear market should be over when the strong hands have given up (one contrarian indicator would be if or when IV posts he has given up on US stocks).

 

[Intrinsic_Value]

Intrinsic Vlaue,

I am confused by your posts.

Is your strategy to write put options? Or is it a combination of sometimes buy/write with call options and sometimes writing puts? I enjoyed doing this last time as I was learning something new, always thinking when to close out positions, looking at pricing models etc.

.

I looked at this strategy (and tried using it in 2010). There is a thread somewhere in the coffe lounge on this topic (covered calls)

Conclusion:
it is hard work, alot of time spent monitoring call positions rather than concentrating on intrinsic value.
Alot of distraction for minimal return.

 

[Aaron_C]

I looked at this strategy (and tried using it in 2010). There is a thread somewhere in the coffe lounge on this topic (covered calls)

Conclusion:
it is hard work, alot of time spent monitoring call positions rather than concentrating on intrinsic value.
Alot of distraction for minimal return.

I think the appropriate metaphor is picking up pennies in front of a steam roller.

 

[Intrinsic_Value]

I may be wrong but it seems obvious that US equities are in a secular bear and gold in a secular bull. But people seem to forget the obvious.

Again you have 'hit the nail on the head'. Your general hypothesis is totally correct.

Until gold breaks its longer term pricing points, its in a secular bull market. Not just US equities, but pretty much global equities are in a secular bear market.

So if one is time poor, just play the secular bull market, with ones stops being just under the underlying longer term pricing point.

No 1 trading rule:
Do more of that which is working, and less of that which isnt.
Gold hasnt broken its long term pricing points, and it is in a secular bull run.