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Monday, March 27, 2017


“Hitler finds out his gold stop has been filled!”

Ok, gold opens the week somewhere out in New Zealand& Australia and immediately goes $12 higher in 3 hours; and of course since then … crickets. Shoving this stuff in the “wee hours” when volumes are lightest and liquidity is thinnest is a “hallmark” of precious metals throughout its illustrious 40+ year trading history; worse in sliver, but that’s little comfort. It’s almost as if the Chuckleheads in Asia couldn’t help themselves and had to buy it … cuz … cuz, well they’re there and that’s their job isn’t it? And an hour before New York opens, gold is sitting right on top of the 50% retracement line of the day so far; maybe we can buck the trend of “Asia buy –New York sell” today, but market history is not kind in this regard. Yes, it does happen, but what does it say about the market when a 2 hour Sunday night session has a bigger range than the next day after 12 hours?

And so here we are in the first hour of New York, and trade flow is almost non-existent, with better trade conditions on the junior trading desk of a third rate bank in New Zealand on a Christmas Eve; seriously, if this stuff can’t go up when the Dollar is getting crushed against the Yen & the SP500 is hovering massively lower awaiting its opening, what’s going to propel it higher?

And we get our answer almost right after stocks open, when USDJPY spikes, the “Plunge Protection Team” shows up for stocks, and gold gets hammered $6 lower in about half an hour … and now we sit just below the 50% retracement line for the day by about a $1.50 - $2.00 per Oz. and market action has morphed back to crickets once again. Every 45 minutes to an hour we get these spikes up [when market is above 50% line] and then get spikes down [when market is below 50% line], and almost immediately thereafter the great M1 “hibernation” as trading action shrinks back into a shell with M1 ranges of 20 – 30 cents or even lower … until the next hour. If gold gets lower on the day … “look out below” might be the appropriate terminology going forward a day or two. Just sayin’, not predictin’.

We break $5 in 6 minutes on stocks lurching forward along with a small USDJPY rally, and now the last hour we’ve been in a $1 range doing absolutely “zilch” … this is exactly why large traders and hedge funds are bailing out of the biz … I’m not making excuses for anybody, but trading conditions day-to-day in the major markets from stocks, to FX, to the precious metals and back, simply take turns chopping people to pieces. This is why I’ve made my decision to trade gold exclusively.

At the New York open gold was at 1258.50 … here, right before Noon in New York gold is off about $2.50 - $3.00 from its opening level … Asian Chuckleheads repelled again for the umpteenth millionth time for taking gold higher overnight … seriously, will they ever learn or no? [Hint: “To ask the question is to answer it”.] And as I write, another shot down out of nowhere taking gold down to within 6 cents of the low bid $2-$3 within 2 minutes, somebody hitting the panic button  before sharply rebounding; another failed spike to “Nowheresville”.

Now, here in the P.M., I see on the rally what might appear as a bearish engulfing pattern in gold at 16:01 server time at Turnkey; that M1 has a 12 cent range … 12 cents … let that sink in for a sec … the offer goes to the bid and that’s a signal? 13 minutes later maybe I’m up something if I’m lucky, but blink twice and maybe not.

Only thing left is a trip back to the highs … hey, why not? Look around the various markets, and everybody is nervous; there’s no liquidity, no consistent volumes, & no follow through … if things hold up like they are now, this is the 4th straight day [Sunday’s 2 hour $12 opening blitz notwithstanding] we are going to see doji or “doji like” conditions; meaning, small ranges, HVALUES barely above $5, opens near the close 20+ hours later, and most importantly, no follow through on the upside or downside of any significance. It is the least likely event on the books, historically speaking, and that’s why it’s my “form of your destruction”; everybody has one [or more], even if you don’t think you do, you do.

Today’s 2 early trades yielded [long] another small “papercut” loss; one was a loser the other a winner, not really anything to speak of money wise, as the cumulative loss was less than a hundred bucks. Still, in some ways, although I hate to lose money in any trade no matter the size of the account, today seemed like a victory. And while I might have played a trade a little differently in hindsight, the net result would have been about the same … so no real difference. As I said earlier, this is the 4th day in a row of this “doji crap”, and while it’s not affecting my trading from a volume or position standpoint, it is nonetheless a worrying market pattern of behavior that needs constant vigilance.

Many times in the past I have seen markets go through periods like this, and while not enjoyable to live through them and/or trade in them, they are what they are and you must simply survive them. Throwing caution to the wind, raising leverage, and/or hanging on to losers is not the way to come through periods like this; what I’m doing is the way to come through periods like this, and that means keeping Dollar losses very, very low and almost insignificant in the greater scheme of things. On the trading floor many years ago we used to call this the “Flying Wedge of Death”; now maybe you know why. This too shall pass, as I keep “powder” dry for when the market moves … this “doji” stuff is literally insignificant to our process … when the market moves we’ll be there.

So, another day another “doji”, what else is new? Here right before the Comex close … crickets. I was very careful today because of Asia, and like the lemmings they become when they almost always bid it higher, like the Sun coming up in the East, New York finds a way to take it all away … and they did it again today like they pretty much do about 99.99% of the time; hell, if it wasn’t for the bullion banks in New York, gold would be at $10,000 per Oz.

PAMM/MAM Spreadsheet directly below.

Beach beckons … I’m outta here … until tomorrow.

Have a great day everybody!

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