Holding on GLD New Position

This is actually not too different than most stocks on the watchlist, close, but not quite there.

 The March positive divegrence sent GLD higher, but the negative divergence in to April was strong evidence of a swing pullback, which is why the GLD Put option trade was posted. Ultimately with May monthly expiration, there was probably enough time for the position to work out, but entering toward the end of Friday the 10th and closing the morning of Tuesday the 14th was barely more than a day of market exposure with a 30% gain on monthly options and I know a lot of you likely used weekly options and out of the money rather than the more expensive in the money (which means even larger gains than the +30%). It just made sense to take that quick gain and wait for a reposition.


The overall divergence on this 15 minute chart is leading negative, although the recent positive can be seen to the far right. It just does not make sense from a probabilities perspective to trade against the highest near term probabilities with calls and rather simply wait to reposition the put trade.

The very near term 3 min chart which is probably where we'll find the signal for the actual re-positioning of a new put trade, shows the leading negative prior to the entry on the 10th and the recent positive that has us close the position on the morning of the 14th before any upside gains started to eat in to our profits.

When this chart turns and goes negative, we'll have the swing 15 min probabilities on our side (the strategic perspective for a options trade) and the timing 3 min chart (the tactical timing perspective).

So we wait with some patience for the next entry. GLD has not made a very big downside move commensurate with the 15 min divegrence yet, so I suspect the next entry will have a much larger move/gain associated with it.