If December Gold were to reverse direction now, surging above 1234.00 without having achieved the 1044.50 target (see inset), it would almost surely signal the end of the bear market begun in 2011. That is not what I expect, however. More likely is that the futures will fall to the target within the next week or so, then bounce sharply. We hold a short position with a profit-adjusted costs basis of 1176, and I am still suggesting that you cover there (at 1046.50, actually), or hedge the short by buying near-the-money call options in GLD that expire in three or four weeks. Playing for a strong bounce from 1044.50 still looks like a very promising play, even though a long-standing bear-market target at 814.50 will remain viable. For now, continue to use a stop-loss at 1093.70 for the short, o-c-o with a bid at 1046.50.
