Not So Fast

Yesterday the Fed got creative with the moves they made and we enjoyed a great rally. Experts hailed the Fed's moves as a way to help the credit crunch and address slowing economic growth without sacrificing the dollar. Today, we found out that investors still don't like the dollar. I have several investments that are at least partially based on the weakening dollar. Those are the gold ETF (GLD), the US Oil Fund (USO), the Swiss Franc ETF (FXF) and the Australian Dollar ETF (FXA). None of these are what I would consider large investments except for USO. Yesterday, I told you that I would sit tight with these positions since they were not sizeable, but I recommended taking profits if you have any in USO and GLD. I did not think the Fed would continue to cut rates aggressively given their moves yesterday. However, the sentiment is still favoring at least a fifty point basis cut next week. While I think there is never a bad time to take profits, I now think you can wait until the Fed announces their decision next week to see where it takes the market. I will continue to hold all of these positions. Since I have sold call options against all of my USO shares, I will have to wait until options expiration next Friday before deciding what to do with them.