couldn't resist picking up some SRS today as a short-term trade when I saw it dip into the low 60s. These double inverse/double levered ETFs are crazy, volatile and fun when they go your way. I probably won't be in this trade more than 2 weeks.
Log-scale 60 minute-intraday chart of the last 8 months on SRS shown below with my thoughts:
I don't trust this now multi-day general stock rally as far as I can kick it. Without a capitulation, a re-test of the prior lows in the general stock indices is the MOST bullish scenario and a drop below these recent lows is more likely. The other thing to remember when the lows hit is this: gold stocks are going to explode higher with the general market when the rally finally comes, outperforming most sectors by a wide margin. I am still looking for at least a 50% gain in the major gold stock indices from the March bottom, which I suspect is still to come in the next 1-2 weeks.
For those that like high-risk speculative plays, I love the chart of Novagold (NG) and think this one is an easy double from current levels:
Posts
