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5 Stock Trades for S&P 1,700

SPDR Gold Trust

If there's any name that's got as much attention negative as Apple in the last month, it's the SPDR Gold Trust ( GLD), an ETF that provides exposure to physical gold. In short, GLD is the most investible proxy for everyone's favorite precious metal.

Gold hasn't exactly been booming this year, and yesterday's greater than 2% decline didn't exactly help matters. But we're approaching a make-or-break level for GLD right now. Here's how to trade it.

>>4 GARP Growers to Buy This Summer

At this point, GLD looks like it could either form a double-bottom -- a bullish reversal pattern -- or break down even further this summer. The key is how the metal reacts to support at the $132.50 level. If GLD can't catch a bid at $132.50, then traders have a signal to pile onto their short positions. On the other hand, if GLD bounces on $132.50 and then pushes through $142.50, then gold becomes buyable. I wouldn't go long gold a moment before that.

Yes, the either/or scenario in gold right now means that you've got to be reactionary to trade it. But the best traders are the ones who react to the market, rather than attempt to predict it. Leave predictions to the fortunetellers, and trade the breakout (or breakdown) in GLD.

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