If you’re a long-term trend follower, this is exactly the kind of move you like to see. A trend gets started in one month and – despite a few hiccups along the way – keeps moving lower and lower over the next 5 months, giving you time to get short…

Disclaimer: past performance is not necessarily indicative of future results.

And then one day:

Disclaimer: past performance is not necessarily indicative of future results.

A drop of more than $80 in a single day is huge… Every 1$ move in the price of an ounce of gold is a $100 change in the value of a gold contract. Anyone who stayed in a long gold position through it all is down $8490 per contract as of this writing (Disclaimer: past performance is not necessarily indicative of future results). And to think, it was just two days ago that Goldman Sachs recommended going short gold. In the annals of timely calls, that was a pretty impressive one. The online commentariat has been discussing this move at length, from the gloating naysayers to the chorus of gold bugs gnashing their teeth in frustration.

We don’t tend to get too deeply involved in that argument here. Managed futures isn’t a place where someone can get very far trying to argue over what gold should or shouldn’t do. Ritholtz posted a pair of great quips regarding gold today:

“Gold is a commodity, not a currency.”

And

“Gold is a trade, not a religion.”

We couldn’t agree more. And some of the CTAs we track are following that advice – Covenant Capital Aggressive has been short for months, and Quest Partners Original was short ahead of today’s move as well. We’ll see how much further gold has to fall, but those CTAs – and anyone who took Goldman’s advice earlier this week – are certainly smiling today.