HOW DO YOU CLASSIFY THIS DAY?

“USDJPY & gold traders worldwide convene for a ‘strategy’ session.”

I don’t even know where to begin to “explain” this day in USDJPY & gold; again for the umpteenth millionth time in the last year, “speed of light” trading followed by … crickets. Gold’s been open for the day about 16 hours and about 13 minutes account for the day’s action where the M1 range isn’t about 30 cents; seriously, that move to the low of the day early on and then “elevator up” straight to the RM=1 exhaustion line was pure “classic gold market action” handing somebody out there their donkey.

This is as tough a non Holiday trading day in gold as I’ve seen in a while; straight down from Asia with a brief respite in Europe before resuming the down trend into New York; an early sell signal near the low of the day had me going “no thanks”, and all of you should know why. “When Asia sells it lower, what happens the vast majority of the time in New York later”? If you were very lucky, maybe you could have scratched it, but you didn’t have more than a few seconds before it was a stone cold loser.

Just one of those days in USDJPY that sees severely constricted intraday volatility, while at the same time decouples from gold and doesn’t correlate very well with anything gold is doing. Frankly, my first algorithm buy signal in gold I didn’t hang onto, and treated as a scalp, specifically because there was no correlation with USDJPY.

My third [and final] algorithm trade in gold was really a “stealth” trade from the signal lines on the M1; 3 previous attempts [all signal lines positively sloping; 3 red M1’s in succession down] all met with theoretical scratches, because once the signal was given they went nowhere; how did I know not to take any of them around 1234.72 ± a few pennies per Oz.? The answer lies over on the M30 chart, where previous attempts earlier in the day failed and produced a short term top around 1235.09 – 1235.20; I would rather be long above 1235 [slightly] than long from around 1234.72 and have the move fail and price abruptly drop forcing me out; I wanted to be as close to the buy stops above 1235.20 as I could get, figuring if the market got here, they wouldn’t be able to resist rallying this stuff another buck or so per Oz. on stops. Sure enough, that’s exactly what happened; so while not in the strictest sense of the word an algorithm trade via the manual like the other 2 [1 USDJPY that didn’t work & 1 other gold trade that worked], the result was the same. And here we are an hour later and price isn’t that far away from where I originally got out.

All in all, 3 trades producing roughly a hair below a 0.2% gain on the day; it’s not “filet mignon”, but it ain’t dog food either. Directly below the day’s pertinent stats compiled into the PAMM/MAM spreadsheet.

 

[click to enlarge]

I traded light today given the circumstances coming into the day; no volume and very little action overnight especially in USDJPY and the “one-way” street action in gold. Tomorrow’s another day; let’s hope market action improves. PAMM accounts continue to be opened and many people are still in the process of funding, as it sometimes takes a while to move money around from place to place, so don’t be surprised to see continued deposits coming in for a while.

Dog’s buggin’ for the beach … whaddaya gonna do? … I’m so outta here … until tomorrow.

Have a great day everybody!

-vegas

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