Short again & some new longs

Bought 300 UltraShort S&P 500 (SDS) @ $33.50 with no stop
Bought 100 Chicago Options Exchange (CBOE) @ $31.50 with no stop (this is an IPO)
Wrote July 34 strike Puts on SDS @ $1.80
Buying more Yamana Gold (AUY) at the open, bringing total share count to 3000

Tremendously long consolidation almost complete

Yamana gold has been consolidating around the 10 level since May of 2009. Meanwhile, gold prices are up almost 30% from that point. Yamana is 50% below where it was in March of 2008, when Gold was just barely at $1000 (the first time).

This consolidation will end as soon as Gold decisively breaks out from the $1250/65 area. I believe this will occur in the next week. Gold did a classic break out and re-test move to shake the weak hands out. The next week should be solidly positive for $GOLD futures and should close Yamana above $11, on its way to $30 in the next 12 months.

Gap and Crap (Out)

Futures this morning gapped up handily -- almost 17 handles when I awoke from my slumber. Everything was higher.

And then, crap. Actually, there have been 3 other bad closes in the last week. One gravestone dogi, two other "ugly" candles. And then this nonsense today.

We need a full candle closed below the 200 DMA to feel "excited" about being bearish again. Until then, I'm not sure what to make of this.

I do know that Gold rolled over like a dead dog, and that doesn't really excite me considering the amount of gold positions I have.

Time to load up on SDS again?? Perhaps.

Likely $GOLD triple top breakout

Gold's continuous futures have already broken previous resistance. I expect a substantial bullish impulse tomorrow!


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Wow

Ok I didn't reopen shorts today like I said I would. Thank god too! I'm not doing anything again until a downtrend in the euro resumes.
Today is a prime example of why remaining short a market over even the intermediate term is often suicidal for ones net worth.


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RIG Bonds

RIG Bonds, due 2013, now yielding 7.3%. Bought 5.

The dangers of High Frequency trading in your own account

Let my example be an example to you all. Overtrading is silly and makes you no money. I have a conviction that the market is headed much lower and I want to hedge my longs. So I buy lots of ultrashort S&P (SDS) in anticipation, and make real $$. Then, I try to get cute and try to avoid the short covering spikes.

This is silly. It's overtrading and it makes you enter positions at the times OPPOSITE what you should -- after the move has already begun.

I am opening new shorts tomorrow using SDS and QID, and I'm not letting go.