GLD Position Update

Monday afternoon I posted an alert for GLD puts, Trade Idea (Options) GLD PUT and they look like they are going to be gaining some momentum here so I wanted to update the charts and just reiterate what I'm looking for.

As we've talked about in recent months, with the F_E_D's monetization program ending, we assume Dollar bills won't grow on the F_E_D's HP tree, thus the recent $USD strength over the last several months that has the F_O_M_C up in arms about global growth due to a strong dollar, hence all of the F_E_D talk last week about QE4 and extending QE3, it's smoke and mirrors, the F_E_D decided a long time ago they were getting out of QE and that won't change, but they learned from the ECB's Draghi that they can jawbone the dollar down, what they haven't learned apparently is that jawboning without action doesn't last long and has an accelerating decay of effectiveness.  My point simply being, as we move to a less manipulated market by Central planners, the old $USD legacy arbitrage correlation should become stronger, that's simply when dollar denominated assets like gold, oil and stocks move opposite the $USD.

Here's GLD vs UUP (USD)...

 GLD in green and the $USD is red on a 60 min chart, there's obviously some correlation here, albeit inverse and I suspect we'll see more and more of that.

GDX tends to track GLD pretty closely as well (gold miners), although recently that correlation has been a bit off so I just want to make clear this is a GLD update, not a GDX update and I wouldn't make any assumptions about GDX based on THIS GLD update..

 GLD in green and GDX is red, good correlation at the green arrow which slips around the yellow arrow with GDX underperforming right now.

As for GLD... I have a feeing that Gold as well as gold miners which have a year plus long base, will enter a primary bull market while equities enter a primary bear market, but the base, escape velocity hasn't been reached yet.

 As this longer term, heavier underlying money flow 2 hour 3C chart of GLD shows, there's a familiar pattern of accumulation at the lows and distribution at the highs, it looks to be an obvious accumulation range with the accumulation at the lower end and when prices get too far from that lower end they are sent back down,  you have to remember institutional money's positions aren't like ours, they are much bigger and they take a lot more time to fill. I figure the home builder accumulation around 2000 as they lifted off from 2002/2003 to 2005 took about a year and a half, I always find it interesting they knew which asset would lead the next bull market while we were just coming out of the previous, Tech led bull market.

In any case we can talk about the virtues of GLD as it nears the lower end of the range, but for now, I suspect that's where it's headed, thus the GLD put as I'm not very impressed with the leveraged GLD ETFs.

 Near term timing charts like 3 min are leading negative

As is the important trade timeframe of 5 min, the minimum I look for to enter a trade.

The swing timeframe of 15 min is leading negative

As is the longer 30 min and 60 min. Most of these also shows the accumulation at the lows as well so I purposefully went with November monthly puts, I'm usually looking for about 3x more time than I think I'll need on my option positions.

In any case, so far so good, I am interested in a longer term GLD long position or maybe we even talk about physical rather than paper, but until we reach the lower end represented by the white band on the chart above this one, I suspect we keep heading lower.