Would you like a 17% one day return?

That’s what one of my members got today. He actually did much better than I did. I am still in this trade. He was able to get in at a much better price than I did yesterday and already exited the trade today.

The trade is a butterfly on IBM. For members, it is May Trade #2

I got into the trade for a debit of 1.24, but this member got in at 1.15. For 4 contracts his cost was $460.

He sold the butterfly and exited the trade for 1.35 today. That’s a gain of $80 and a return of 17.39% – in one day!

I myself am up a little less than 10% so far.  Hopefully I too will be out in a couple more days with a nice double digit gain.

A little over a year ago I went to one of those free trading seminars provided by companies that want you to sign up for their coaching or training.

The concept they were teaching was day trading and so it did not interest me very much, but a couple things the speaker said were very interesting. The guy’s name was Tom Busby.

He said that once a stock breaks a hundred $ level for the first time it zooms up 10%.  For example, once a stock breaks through $100 it is going to $110. When it breaks through $200 it is going to $220, etc.

I had heard this before somewhere so I started looking it up. It turns out that Jesse Livermore mentioned this in one of his books. Livermore was probably the best trader of all time.

So now with two reference points I decided this was something worthy of looking into. [...]

Is Gold a bubble or the trade of a lifetime?

Maybe both.

I have not been in the gold trade myself. But several of my members are, and doing very well so far.

Here is a chart provide by one such member. It shows that the stock of gold companies, miners, etc continue to appreciate evn though gold prices peaked earlier. If this hold true this time, even if gold has peaked, which it does not look like it has, the miners will continue to rally.

Last week a member emailed saying that it looked like GLD had topped out and would I consider selling calls. My answer: No Way.

This train still has momentum on its side as you can tell from the rally today. What I did do on Friday, was to buy a debit spread in GLD.

I bought the Jan 115 Calls and Sold the Jan 118 Calls. I paid about $100 [...]