Update 12/26/08, + Gold

Sold V for a loss today. Since two of our remaining three holdings are gold-related (one long and one short!), I thought I'd share my thoughts on gold action. On the 17th, gold pierced through resistance at the 200-day moving average, and as expected, proved unable to hold. It "should" now correct down to the flattening 50-day moving average, possibly even farther because of the open gaps at at GLD 77 and 75. (If not this leg down, a future leg down.)


However, gold can surprise. It doesn't do what it "should," and part of that is because it's a 24-hour market. It rose with some urgency today over the course of 5 hours, looking like it would get even higher, and then when the Hong Kong market opened it erased nearly all of its gains in 15 minutes, in a precipitous fall down. We currently have a semi-hedged stance, long a gold miner and short the metal itself, but not by design. It's just how the charts worked out.

Current Holdings
Ticker	Basis	Closing Price	Perf.	Sell-Stop	Additional Exit Guideline	Chart
LIHR	16.21	18.88	+16.5%	17.10	Consider selling on a close < 18.60	Chart
FAF	28.07	28.92	+3.0%	27.19	Consider selling on a close < 27.79	Chart
DZZ	28.22	27.09	-4.0%	26.85	N/A	Chart