When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline.
Trade Alert - (GLD) – BUY
BUY the SPDR Gold Shares (GLD) March 2025 $240-$250 vertical BULL CALL debit spread at $9.20 or best
Opening Trade
2-28-2025
expiration date: March 21, 2025
Portfolio weighting: 10%
Number of Contracts = 12 contracts
Gold has recently reaffirmed its status as a flight to safety asset class when safety is suddenly commanding a big premium. This is all happening against a backdrop of global wars, but also a rapidly derogating US Economy.
Today, the Atlanta Fed said that the US GDP Shrank by -1.5% in Q1, meaning we are already well on our way into recession. The Atlanta Fed always has the most extreme forecasts. The latest reading from the Atlanta Federal Reserve Bank's GDP Now model, which is considered the central bank's primary tool for measuring growth in real-time, indicated July 1 that real gross domestic product shrank by 2.1% on a seasonally adjusted annual rate in Q2.
It is all very gold-positive.
If you can’t do options, buy the stock. My long-term target for (GLD) is $500, up nearly a double from today’s $262.
Therefore, I am buying the SPDR Gold Shares (GLD) March 2025 $240-$250 vertical BULL CALL debit spread at $9.20 or best.
Don’t pay more than $9.50, or you will be chasing.
DO NOT USE MARKET ORDERS UNDER ANY CIRCUMSTANCES.
If you live in a foreign time zone when the US stock market is closed, such as Australia, or don’t want to spend all day in front of a screen, simply enter a spread of Good-Until-Cancelled orders overnight, like $9,20, $9.25, $9.30, $9.40, and $9.50. You should get done on some or all of these.
The bull case for gold is simple. Falling interest rate means less yield competition for gold, which yields nothing. China and Russia have been stockpiling gold for years to avoid international financial sanctions. The only way the Chinese can save right now is to buy gold.
A global gold shortage is developing with new mine costs rising. Gold also offers protection against rising US debt, which is expected to hit $35 trillion shortly.
On top of all this, Chinese speculators have shifted their principal savings vehicle from real estate, which has crashed and has no future, to gold. This adds a large retail element that has never existed before.
SPDR Gold Shares (GLD) is a play on physical gold. They are shares in a corporation that owns 400-ounce gold bullion bars held by a London trust. It is far safer owning gold through the (GLD) than owning your own physical gold bars via a third-party custodian. If the custodian goes under, which is frequent, your gold is gone. With (GLD), your credit risk is with State Street, a highly rated firm with a strong balance sheet.
For details about SPDR Gold Shares (GLD), please visit their website at https://www.spdrgoldshares.com.
This is a bet that the (GLD) will not fall below $250 by the March 21 option expiration in 15 trading days.
Here are the specific trades you need to execute this position:
Buy 12 March 2025 (GLD) $240 calls at………….…….$23.00
Sell short 12 March 2025 (GLD) $250 calls at..………$13.80
Net Cost:………………………….………..………….…............$9.20
Potential Profit: $10.00 - $9.20 = $0.80
(12 X 100 X $0.80) = $960 or 8.70% in 15 trading days.
If you are uncertain about how to execute a bear put options spread, please watch my training video by clicking here.
The best execution can be had by placing your bid for the entire spread in the middle market and waiting for the market to come to you. The difference between the bid and the offer on these deep-in-the-money spread trades can be enormous.
Don’t execute the legs individually, or you will end up losing much of your profit. Spread pricing can be very volatile on expiration months farther out.
Keep in mind that these are ballpark prices at best. After the alerts go out, prices can be all over the map.
