When looking at GLD recently, we can see that it broke below its 200 day MA as well as it broke thru its long term trend. It seems GLD is poised to go lower. Today the market showed a bit weak trading (compared to yesterday’s big move), so I believe, GLD can get lower during this month. Right now it is attacking 200 day MA from which it may go back down to $150 or even lower.
I will play this downtrend by placing a butterfly on GLD:
SPDR Gold Trust
BTO 1 GLD Jan21 2012 154 Put
STO 2 GLD Jan21 2012 150 Put
BTO 1 GLD Jan21 2012 146 Put
Price: limit debit $0.58
Max risk: $58
Max gain: $350 at expiration if the stock lands at $150 per share.
01/05/2012 – order filled @ 0.58