“Trading gold? Then you just might be
right here!”
Ninth day in a row neither Asia or Europe put in an
HVALUE of more than $5 overnight; truth be told, I don’t think anybody in Asia
or Europe has any conviction whatsoever about entering any trade, long or
short, given the amounts of money they
have lost over the last 4 months. The “talking heads” will point out that the
head ChiComm Comrade will be with President Trump this week for meetings and
markets are awaiting details, along with more worthless Fed minutes and more
“blah blah yada yada” and the NFP on Friday, and the list goes endlessly on “ad infinitum nauseum” into the sunset, like
it’s gonna make a difference somehow “this time”; “oh yea, how many times in the past have we heard tripe like this? Cuz
when it’s over markets move for 30 seconds and then … crickets again … and yet
I’m supposed to believe there’s gonna be some ‘big’ announcement coming that
could shake markets? Yea, sure … whatever”.
Let’s face facts shall we: big moneyed traders around
the world are completely f-ing paralyzed,
wondering what hour, minute, & second they get caught up in some insane
market moving hyper-frenzied zeitgeist caused by either a Pol and/or some
central banker apparatchik trying mightily to feed his mistress, when either of
them open their Pie Holes to intentionally move a designated market on their
“hit list” to a preferential & preferred outcome. EXIT QUESTION: “How can you blame them”?
And so, here we sit yet again on a Monday, firmly
entrenched inside “chop” for the 9th day in a row, and more and more
of what I said on Friday is becoming reality; namely, that beautiful creature known
as volatility has gone the way of your ex from high school, who in her day was totally,
insanely hot, but now years later after 5 kids and 90 pounds looks like Tony
Soprano with a blonde wig, says “oh my,
you look the same as you did when we were seniors … woof!”, and you’re
thinkin’ [but not sayin’], “OMG! WTF
happened to you”? Yea, that’s volatility now, and if you don’t get your
mind right, it will hurt you.
Here at the New York open, we’re right on the 50%
retracement line with an HVALUE of $3.68; “and
to think, I could have answered that ad in the ‘Weekly Nickel’ for a groomer
for the bearded lady at the circus … but no, the Mrs. nixed it cuz she didn’t
want to live in a gypsy caravan … gads, some people are so selfish”.
Oh … wait, I forgot, how stupid of me not to remember
these “key” events for the week, which is the “official talking heads”
manifesto being put out this morning, no doubt with the compulsory “wink &
nod” from the chicken dinner club at the Eccles building in D.C., to keep trader
sheeple pacified & numbed until at which time they get the “go ahead” for
anything to move; and believe me, JPM, Vampire Squid, Blackstone, Virtu, &
Citadel will be the first to know and then act; “hey, where’s MY email”?
An hour and a half into this clusterfark, and we got
“doji’s everywhere across the spectrum; USDJPY, gold, SP500 … “why, I even see ‘grade A’ dirt futures are
unchanged … what’s the trading world turning into?… I don’t even know how to
describe this it’s so bad … and now back to HGTV where I can spend productive
time watching reruns of ‘Property Brothers’ until it’s time to feed ‘you know
who’ some bacon from the impenetrable bacon box in the kitchen … oh yea, he’s
sittin’ here at the ready, just waitin’ for me to flinch an inch towards the
kitchen so he can go ‘full metal bacon jacket’ on me”.
Oh my, this just in from the gold morgue … “soft” PMI
at 10 means they found a pulse from some folks buying gold, cuz I guess that
means those 4 rate hikes aren’t happening the rest of the year? And this is
news somehow for which class of clueless market twit that seriously thinks the
FED has an ounce of credibility left?
Those of you who have been reading my posts for any
length of time, know of the phenomena of the Asian “Chuckleheads”; well, last
night no exception as they sold it off from the high in hour 1 to almost the
low in hour 7 about $5 lower. Europe tests the low and we’ve been up ever
since; and we all know that when Asia
sells gold lower New York will take it higher, and when Asia bids it higher,
the bullion banks in New York will take it lower. “For all of the
days/weeks/months, and in some cases years you’ve been following my posts, have
there been ANY days you know of where this isn’t the case? Any … any at all”? SHORT
ANSWER: “NO”!
After crunching reams of data over the weekend, it
became obvious to me that at the start of every day, we need to establish 2
horizontal lines on the gold M1 candlestick; 1) daily range 50% retracement
line for first 12 hours of the day [white], and 2) opening bid price at 8 A.M.
in New York for the start of the day [Aqua]. THE HVALUE IS OUT!
All that matters are the M1 candlestick formation
signals which we already have, and these 2 lines. What we are specifically
looking at in terms of importance are ± $2 from the aqua line [New York open];
if it’s + $2 from the open we are in buy mode on M1 buy signals; if it’s -$2 we
are in sell mode on M1 sell signals; our most powerful signals will come when
both lines are either above or below market price.
And given the fact that only about 1 out of 500 days
does New York join Asia in some kind of euphoric romp in one direction, this
New York open at 8 A.M. EDST becomes a very important “line in the sand”. Cuz
whenever New York
goes ± $2 from its open, there’s not a very high probability it’s going to turn
around and go the other way. And more importantly, it plays right into the
hands of what we know about the Asian session anyway … “they’re damn near wrong almost every frickin’ day”!
Earlier today, I gave it a whirl, and if not for the
fact that the Turnkey LP filled us 40 cents per Oz. off the market on
liquidation as the market was GOING UP,
AND the fact the LP shut the gold
feed off on the correction from the high at the turn where we had a signal to
buy with an engulfing pattern, it would have worked beautifully! As it is, we
get a few pathetic pennies in profit, but no matter, the information is worth
10X that from the trading action. Directly below the trade, followed by the
signal we missed due to the MT4 feed being shut off.
If you sit down and spend some serious time thinking
about it [which I’ve already done so you don’t have to], there are 2 critical
points to take away from the changes in the algorithm; 1) we play into the
“wrongness” of Asia by allowing our signals to “be in play” only $2 from the
open in New York, thereby allowing us to be there on the off chance they do go
in tandem during the day, but also giving us an earlier jump on what’s going on
from a price standpoint when Asia gets
faded like it does almost every day, and 2) in this low volatility
environment we find ourselves in, where I’m predicting right now daily ranges
for the most part will be between $8 - $12 about 95% of the time going forward
into the future, we simply can’t afford the luxury of waiting for days that
aren’t coming so we can capture the last few bucks of a $15 - $22 per Oz. move
after the $5 HVALUE has been achieved. If they come … GREAT … but I don’t see
it happening anytime soon like in the past … I’d love to be wrong on this, but
I don’t think I am.
Today is a great example of this; daily range so far
here at about 1 PM New York
time with 90 minutes to the close is $9.25, with an HVALUE of $5.57. Ok, since
the time the market hit that $5 threshold, the market gave us a whopping 57
cents to play with, and right now as I look, it’s a little over $1 off its high
for the day. So, any trade signal you would have received, at best is a scratch
or a loss as the market limps its way to the Comex close.
On the other hand, the New York open was at 1246.68 bid at 8 A.M.
[12:00 Turnkey server time]; that puts the aqua line at 1246.68 with buy
signals above 1248.68 or sells on signals below 1244.68, whichever is
appropriate. In the case of today it is 1248.68. The 50% retracement line at
the open isn’t important; that comes into play after you establish a position
off of the aqua line & the M1 signals. Remember, gold does not reverse that
often, and even rarer than that are double or triple reversals over $5 in scope,
hitting a new high and/or low along the way. So, we give up the reversal, and
concentrate our efforts on being LONG when gold is above the $2 aqua line at
the open, and SHORT when gold is below the $2 aqua line at the open. Under no
circumstances do I want to be short gold when it is HIGHER THAN THE NEW YORK OPEN, or long when it is LOWER THAN THE NEW YORK OPEN. What that
means in the case of today, are potential market buy signals a full $5 sooner
than otherwise would be the case with simply the HVALUE; I consider that
significant, especially in light of the approximate $9 daily range!
What we are looking at is simply a minor revision to
the version 3 volatility algorithm; this is now the version 3.1 volatility
algorithm, where I have lowered volatility “expectations” and taken the
Chuckleheads in Asia into the mix and simply said, “well hell, the bullion dealers are taking advantage of them, and I
want to be on the bullion dealers side, so sure sign me up … I’ll be more than
happy to incorporate this important piece of the gold market’s structure into
my algorithm”. And really, looking at the cold, hard logic of the trade,
we’ll still do well when that “blue moon” event comes when they both coincide
and go in the same direction, cuz the ± $2 is the threshold from the New York
open, NOT the fact that Asia is almost always wrong! [Although, it’s nice to
know we can make money fading Mrs. Wantanabe & her gal pals.]
Here right before the Comex close [market catching a
light bid due to weakness in USDJPY], under normal circumstances I’d be pissed
at what transpired today, but I’m taking a more “holistic” approach and looking
at the bigger picture; and that bigger picture gives me a very clear snapshot
going forward of how to proceed and not only make money, but thrive. On
average, today was/is like every other medium to slow trading day we’ve seen in
gold since anytime last year, with a couple of small runs and then when Europe
closes, trading dwindles down to almost nothing by the Comex close; so, my
point is, that if it worked today [and it did] it will work well into the
future with few exceptions. “That’s
something to celebrate & worth far more than a simple winning trade from
one day”! And if … “IF”… gold
perks up and we start getting $20+ ranges consistently again in the future,
these new algorithm guidelines will only help us improve profits; in other
words, there is no downside to adopting them.
During the week I’ll be updating the gold algorithm
manual and tutorial and changing the PDF docs to the version 3.1 volatility
algorithm; I should have them ready by the end of the week going into next week
on Sunday night.
PAMM/MAM Spreadsheet directly below.
Beach beckons … I’m outta here … until tomorrow mi
amigos.
Have a great weekend everybody!
-vegas
OUR ‘TURNKEY FOREX’
PAMM/MAM IS NOW OPEN AND
OPERATIONAL; SEE “PAMM/MAM MANAGED MONEY PROGRAM” IN “DOWNLOAD LINKS” SECTION
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