Pailin's Trading Corner

this goes out to SSK and General Atlee bunking at the Stalag

http://socioecohistory.wordpress.com/2012/01/05/obama-hope-you-dont-get-...

Ooops, my photo of Col. Hogan and a German hooker didn't post. It was a good one.

Moving back up here. Tomorrow could be a good one.

Keep in mind SPY is government sponsored and they like to close it high on Mondays especially if it sold down some. It think today is no different. IMO

S&P showing multiple tests of these highs now.  I think they breakout and run tomorrow but if they fail after all these tests it could also fall very fast. Who knows?

Often don't do much during an oil spke
in my experience. In fact, more likely
to tank due to some oil profit tax that
gets specially implemented...
I really believe that lithium and rare
earth stocks will be hot again when
oil gets back through 130 one day
(maybe sooner than we think.)

Check out this little douchebag over on SeekingAlpha.  Is this really the face of the big money that is wedded forever to the long gold/short miners ratio? No, but it's good to put a face on the trade. The guy is like 12.

http://seekingalpha.com/article/318300-2-long-short-pair-trades-for-2012...

"Long DGP/Short GDX

This second trade is based on our view that gold mining stocks will continue to underperform the gold price itself. This is a view that we have held for some time and frequently have written about. We believe that owning gold mining or exploration stocks is a very poor way to gain exposure to the gold price and we have been actively discouraging using mining stocks as a gold investment vehicle since May 2008. For our reasoning for this view please read one of our articles on the topic.

We are bullish on gold going into 2012 and although we would not be buying mining stocks that does not mean that gold stocks will not increase in value. They may well increase in value, but we think gold will still outperform the mining stocks. Therefore this pair trade is a long gold/short gold mining stocks position. This is something we have been suggesting throughout 2011 and we should point out that a Long GLD/Short GDX pair trade would have returned 26.2% during 2011.

However we have decided to use DGP (PowerShares DB Gold Double Long ETN) in this particular trade as there is a chance that gold miners may match gold’s rise this year, but we put a very low probability of them performing twice as well as gold. We are suggesting using GDX (Market Vectors Gold Miners ETF) but the trade could also be constructed by shorting a basket of gold mining stocks of the traders choosing. This trade could also be executed using gold futures or GLD.

This trade will deliver losses if; gold prices fall and gold mining stocks fall by less than half as much or, if gold prices rise but gold miners increase by more than double the rise in gold. We expect gold prices will rise and this rise will be larger than any rise in mining stocks.

The trade would be executed as follows. Again, one must match the legs of the trade dollar for dollar, not share for share. So for every share of DGP bought at $50.80, one must sell roughly 0.95 shares of GDX at $53.35 to properly construct this trade. For example one could buy 100 DGP and short 95 GDX."

So you are saying spx will either go up or down from here. Can I bank on that?

HEY! I thought you guys were always serious during trading hours? I poked my head in from the Speak and saw Rico's post. I didn't know you had afternoon entertainment.  Came across this one when I went inside

Hope all are doing well.

http://www.washingtonpost.com/politics/white-house-chief-of-staff-willia...

Obama is clearing the deck of vermin,rats and other scum to make way for his election year.  I mean talk about Chicagoland Mobsters, between Daley and Emmanuel he cornered the Market. Not even the pretense of propriety there.

Neuman's moment -