Trading Commodity Update for GLD, SLV, USO & UNG
Chris Vermeulen, June 29th, 2009
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Last week commodities moved higher as investors started buying into the recent pullback in prices. This is a healthy sign for the overall market. This is a quick update for gold, silver, oil and natural gas short term traders.
GLD Gold ETF Trading Chart
Gold has provided us with two great trades this year. Both trades lasted only a few weeks and we locked in profits on technical breakdowns. Many of you have been asking when we will get a short signal (make money in a down market). Well, I don't like shorting a commodity that is in rally mode. KISS is my mentality and trading only with the major trend is what I focus on.
For those of you who want to short gold (DZZ Ticker) may do so at your own risk, I recommend waiting for an extended rally of 10+ percent in price before you start looking for a technical breakdown to short. The quicker prices rise, the higher chance that a technical breakdown will provide a quick shorting opportunity. Locking in profits within a few days is crucial. In a bull market pullbacks in price are generally quick and short lived.
SLV Silver ETF Trading Chart
Silver and gold generally move in the same direction. These precious metals are looking ripe for a low risk setup. What I am looking for is momentum to turn up along with a reversal candle pattern. We continue to wait.
