For subscribers not keen on facing the sometimes considerable risks of trading gold futures, you can substitute this equity vehicle. For today, I’ll specifically recommend placing a ‘mechanical’ bid for 200 shares at 117.58, the midpoint Hidden Pivot, stop 117.10. If the trade goes well, take off half the position at 118.99, two cents shy of the 119.01 target. If you would prefer to use call options, I’d suggest focusing on the March 03 118 calls. They settled on Thursday at 1.16, but if GLD dips to the red line in the early going, I would expect them to be trading for around 0.78 – 0.88. Don’t pay up for them, since you’ll already be giving up edge by trading options, whose value decays over time, instead of stock. Decay tends to be particularly noticeable on Fridays, when longer-dated options come under pressure as the nearest ones expire.
