Overnite sensation...and a nasty hangover

Flash Rabbit couldn't believe his eyes when he woke up this morning. The dollar had strengthened even more and gold had collapsed. He's now seriously in the money and has left things pretty well as before, but took the pause in gold as an opportunity to move some stops and do some profit-taking. However the gold collapse shows no sign of abating - Flash's next target for gold is around the $720 mark - if it can do -$150 in a couple of weeks he doesn't see any reason why it couldn't do more. So most of the short positions remain firmly intact, although he took a grand out to pay some of the bills.

It's been a pretty thrilling couple of days and Flash has been exploiting leverage to the full which has led to some pretty dramatic moves in his account - he nipped out for half an hour around lunchtime and came back to a 40% pullback as the indices and currencies gyrated which was a bit of a shocker - but fortunately he's learnt the lesson of keeping enough margin and didn't blow up any money. He's getting pretty nifty at using some of the margin from the more profitable trades to set up some leverage. And he's keeping those currency trades going - has taken a bit of profit on the EUR/USD short but otherwise they are all running well. He's expecting a bit of a fightback from the dollar bears but thinks that momentum is with the dollar (and also, in its own way, the yen). Especially when the full depth of horror of the economic data coming out of europe hits home.

What Flash can't figure out is that even with all the chaos and anxiety in Georgia that energy and gold still managed to keep their descent, but it all went a bit screwy today even as the Russians pulled out. Precisely the opposite of what one might have expected - but it became a bit clearer watching Bush late last night that the USA had no intention of starting World War 3. Today's turbulence must have had something to do with another forecast of higher oil prices and the bad guys coming out to play the short financials/long energy trade - they just can't keep off it...He had a nailbiting day yesterday when he was full on short gold and long dow, but holding the view - and taking the risk of holding some heavily leveraged currency positions overnight - really paid off. He takes this as a sign that there is a major structural adjustment in progress, and thus is sticking to his guns.

A few regrets - not hanging on to the UAL Corp long - they're up a ridiculous amount from when Flash bought them at 693, and he wishes he hadn't jettisoned them in all the turbulence; but the BA long and Barclays long have made up for that. The equity positions are all looking pretty positive; he's still holding on to that long Dow, and has added bits to it along the way; he's also long FTSE, S & P and now Nasdaq as well. Even with today's heavy financials sell-off he thinks there's tons of value still to be found in equities, especially in some very underpriced retail and property stocks - so he's added to his long positions in Workspace Group, Woolworths, Kingfisher and Blacks Leisure. D1 Oils has also been excellent - sitting at 40p and he bought them at 17p. He bought a bit of Cadbury and currently has enough profit on that trade to buy around 2 bars of Dairy Milk - not so impressive; He's keeping on that too, and has even added to his long in Crocs! We'll see.

Generally - it's the usual problem - too many choppy trades, and not holding his nerve and his view for long enough. But he is learning, and the cash is now flowing in. Just as well because he hasn't got any cash coming in from anywhere else right now. Very risky. But very rewarding.