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Like most people who end up with their own blog, I have become overwhelmed with the job of managing information. I subscribe to numerous feeds and literally swim as hard as I can just to stay up to date. Many people I know have asked about where I source my news and commentary and it becomes an awkward, unwieldy experience trying to encapsulate a cogent reply. So this blog is my attempt to point people to a single place where information I follow flows. My blog list is very extensive and I have tried to whittle it down substantially. I am also on the prowl for more blogs, therefore all recommendations will be highly valued! I have daily feed straight to this site some of my favorite content. Daily review of Mish Shedlock, Nathan Martin, Jim Sinclair, GATA, and Martin Armstrong are essential IMO and will be posted here. Also, I endeavor to provide weekly Technical Analysis of Gold, Silver, US Dollar, and select markets. I hope to provide some with an exposure to technical analysis, and at the same time hone my own skills. Also, I will be adding commentary to the daily feeds from other sources. In time, this will be the primary focus of my blog as frequent visitors will channel feeds appearing here directly to their own sites and will come here for either analysis or commentary. I hope you find some utility here and it serves you well out there in the Matrix!

Wednesday, May 5, 2010

Elder Impulse Update 5 May

SLV got plowed big time today and is painting a red bar.  Any impulse trade in the near future is remote.  GLD on the other hand is hanging in there and closed well off the lows and up for the day.  The impulse chart shows a 2nd blue bar and the MACD histogram doesn't need much at all to change slope from negative to positive.  Since the bar is blue and the histogram slope is negative, price is still above the 13 day EMA.  Therefore a positive histogram slope will render a buy signal.

Daily: "

via StockCharts.com
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I am looking for a quick momentum trade and the May 110 call as a likely candidate.  Fair value after the close is 5.47, where GLD closed at 115.02.  This option today has $5.02 in intrinsic value and a risk premium of $.45. The delta is .84.  The longest period of green bars in the last 6 months was 7 straight trading days.  Therefore, I do not expect to be in the trade more than 10 calender days.  My target is $16.50 during that time if an impulse is triggered.  This would yield a option price of $6.53.  Without commission, this is represents a gain of 19.4%.  I plan on buying 20 contracts with a $.40 stop limit, or a total down side risk of $800.  Therefore my reward to risk ratio is 2.65, or a risk return of 265%
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