Today’s trading was hectic and markets fell hard after FOMC meeting. The market is idicating nervousness and today’s price action – extended bearish candle may indicate the end of the trend.

Almost all my stocks fell hard as well. I am not that concerned about it however, since I have been expecting correction since two weeks ago. I just moved more cash to my account to protect my current posittions against potential margin calls, and will be riding it down where I may start adding more shares.

However today trading offered some nice opportunities as well. I was watching GLD and I had a buy trigger order at $151.60 a share. Honestly I didn’t expect Gold to reach this mark today. I was expecting a couple more days for Gold to slide towards that mark.

Gold was under sell off recently because of some institutional investors unloaded Gold from their portfolio. For example Sorros Fund Management sold 50% of his stake in Gold as reported in December 2011. I am not sure when this latest 13-F filling came actually out, but it is quite outdated. If traders were reacting to this news today, then it is a very stupid reaction.

Gold is very oversold these days and today trading could mark an exhaustion day. An exhaustion day can indicate the reversal in stock trend. It is a day, when everybody give up and throw the towel into the ring. Usually retail investors aren’t willing to bear more losses anymore and sell. Typically it is that last wave of selling (or buying if we look at bullish exhaustion), where there is no more sellers and the stock reverses. This day is marked by large extended bearish candle (or bullish) with unusuall increase in volume and it must occur during a continuing trend. When you take a look at Gold, you can see the stock falling since October last year. Today the stock fell sharply on heavy volume and it reach major support line. This support line has been formed in July 2011 when the parabolic run up in Gold started and this support was tested (and held) for many times during the last period.

Based on above technical anaylisis I believe Gold has reached bottom. Based on that I accepted my buy order and let it executed. If however Gold continues falling I have reserve funds and will be buying on my next buy point level which is at $140 a share.