Buy TLT (sell puts)

Buy TLT via selling Feb 85 puts TLT around 89.40

Sentiment is mostly to the bearish side on Treasuries. Chart support at the recent low at 87.5.

Long TLT

Survey says...

Two surveys are giving mixed signals. The newsletter survey, Investor's Intelligence is at 15% bears (link). If that was all there was, that would be a big time sell signal. Part two of the story is that the individual investor survey AAII, is neutral with a near equal percentage of bulls and bears (link2).

Individual investors have been steadily selling their stocks and stock funds into the rally. Newsletter bears have gone into hibernation. It may be worth taking a shot at the short side, because of the low percentage of bears on the newsletter survey. However, it is likely any correction will be short and sweet because so many individuals have piled up cash expecting a pullback.

As always, sentiment is just one indicator, and no indicator is 100%.

No trading positions

Barrons: Lessons learned, and to be learned

Barrons has an article looking back at the 2009 markets in review, that ends with a peek forward (link).

One reason for me to do this blog is as a public trading journal. Journals are an excellent way to put trading plans down, and then look back to see if the plan was followed. They are a good way to see what kind of thinking causes losers, and the winners too. Most folks learn more from their losers.

Lately, I haven't had time for trading, or looking back, or looking forward. Perhaps this year end period of quiet trading may be a good time for financial reflection. Reflection is very different from prediction. Reflection for traders is about refining the process of selecting, entering, stops, and exits. Prediction is often times more for entertainment or for those with something to sell such as stocks, or other securities, or perhaps a subscription to a newsletter, or a hotline service.

Readers know that I'm not selling anything and hopefully also know that I will shoot straight with them.

No trading positions

1-0 for December

One winner, no losers for the December option cycle. The SPY Dec 99 put expires and I pocket the small premium.

No positions

Shake that gold tree

Gold bulls remain mostly confident and defiant after two weeks of losses. This isn't good news for bulls. It means the odds favor lower prices.

What might be the best scenario for long term gold bulls is an even harder shake out that gets some of newsletter/hotline types to jump off the bandwagon. When the wagon has so many folks on board it is difficult to move higher, even more difficult to make new highs.

Sometimes the secular trend is so strong that the majority can be right and stay right for an extended period of time. That said, sentiment can be a powerful indicator, one of the best for calling turns.

Long SPY (expiring 12/18)

Barrons on GLD option skew

Barrons has an article about GLD options (link)

>>
For the first time in recent months, the puts on SPDR Gold Shares (ticker: GLD) -- the exchange-traded fund that everyone uses as the primary proxy for the commodity -- are becoming more expensive relative to calls. Such a change would be practically invisible to most investors, but sophisticated investors and professional traders watch them closely. Why? Changes in "skew," which is the difference between the volatility of out-of-the-money puts and calls, is often the canary in...the gold mine.

>>

I am watching GLD, and TLT. I don't have enough time to look at most individual stocks.

Long SPY
(* There was a SPAMMER on the Tuesday SPY buy post, that I couldn't figure out to delete, so I deleted the entire post. Sold DEC 99 SPY puts.)