“Just as soon as I can get my donkey
back into gold!”
Well, it’s nice to know the Chuckleheads in Asia are
back from vacation, cuz quite frankly nobody knows what to do in New York later in the
day without their guidance. “Hey, gold’s
up 5 days in a row [including the Sunday session], it’s just got to be a sell”!
And then they all got their noses out of joint when stocks started to tank,
and so it brings me always back to what I’ve consistently told you about the
traders in Asia; “when Asia sells, at
some point New York rallies, and when Asia buys, look for New York to take it
away and then usually some more”! And with that, I was looking for a rally right
out of the proverbial gate today.
Let’s hope today’s action in gold portends larger
HVALUES & daily ranges in scope going forward; outside of yesterday, the
last 3 out of 4 days has been very good. Not really a very good signal day from
the long side; only one signal to get long and that’s the one I took. All the
other breaks on this rally up did not have my requisite engulfing or reversal
signals. On the top side, there were some short term sell signals, but as I
have stated repeatedly, you open yourself up to spikes higher that can be
vicious, and so the best course of action is not to try and pick tops to sell.
Range & HVALUE plays in gold are tough; you simply
cannot buy the rally and/or sell the break to initiate a position. You have to
wait for the corrections and subsequent signals. You buy or sell “breakouts”
from resistance or support, and you are asking for heartache. First trade today
and you’d think I must have missed something, cuz it wasn’t a very big
correction, but there was a small “hammer” bottom at the turn. Directly below
the trade.
There was a very small “hammer” around 12:50 server
time, back when gold was much lower and the stock market was about 40 minutes
from the open, but only in hindsight would have this been a good trade; the
hammer is only about 15 cents in scope, not exactly a screaming buy signal when
things are quiet.
Today’s gold rally is a direct function of the
sizeable stock market selloff; going into the close, we’ll see if further
weakness translates into more gold buying … any late day rally in the SP500
could spell some nasty liquidation in gold for the day, as longs hit the exits.
We’ll see what happens.
I traded low volume today, simply because there were
no clear signals from a more normal, deeper correction; the most this stuff
corrected was about $2, and it was when I did the trade. And while I would have
liked to see a more corrective process unfold, plenty of times gold doesn’t
give us this luxury; it just goes straight to wherever it feels like and leaves
everybody standing on the platform at the station.
With the stock market suddenly discovering gravity,
I’m pleasantly pleased gold acted as well as it did today; there actually seemed
to me to be some trade flow. We had that first $3 jump through stops, and that
really turned out to be the only disruptive flow of the day. Let’s hope it
stays like this.
Here in very early afternoon trade in New York, what
we’re seeing in gold is a classic short squeeze, and every time somebody tries
to offer it down, somebody steps up and immediately bids it higher; I have no
idea how far it can go or how long it will last, but what I know is that if you
are short you are losing money and are very nervous, and if long getting ready
to hit the sell button at the first hint of a selloff. Wouldn’t want to be
short up here, and being long is no bed of roses either, especially close to
the high around the 1246 area. Best bet is a quick selloff and further rally
into the New York close at 4 P.M. Tomorrow is going to be really, really
interesting, and I’m wondering right now if Asia is going to be bidding this
stuff up tonight.
Two key items I want to focus on before I finish for
the day; 1) volatility [yesterday notwithstanding] seems to be picking up in
gold, and the trade, at least today and hopefully going forward, has a more
normal flow to it and isn’t as “herky jerky” as in weeks past, and 2) on some
normal corrections, once I get a lead on the trade, I’ll be hanging on longer
for bigger gains via the signals. Today, as it so happened, wasn’t that great
for signals as I mentioned before … only one really and it’s the one trade I
did do … all in all, I expected more from the day, but it is what it is and if
I’m going to only get one signal, hopefully it’s on a correction that then goes
somewhere; usually most of the time there are a whole lot more than one signal,
but all we can do is take what it gives us and move forward. As a positive,
although it’s not nearly as much as I would have liked to make, the one signal
we got today put me up money immediately, and I didn’t have to put up with the
BS Forex dealer games either, so from that standpoint I’ll take today as
partial victory. Like I said yesterday, the algorithm signals for gold work
exceptionally well … you just have to show patience and wait for them and not
get caught up in buying rallies or selling breaks … that’s what I did today …
that’s what I’ll be doing tomorrow.
Oh, how I can’t wait for tomorrow … this is gonna be
interesting.
PAMM/MAM spreadsheet directly below.
Beach beckons … I’m outta here … until tomorrow.
Have a great day everybody!
-vegas
OUR ‘TURNKEY FOREX’ PAMM/MAM
IS NOW OPEN AND OPERATIONAL; SEE “PAMM/MAM MANAGED MONEY PROGRAM” IN
“DOWNLOAD LINKS” SECTION IN RIGHT HAND COLUMN FOR DETAILS [VIEW ONLINE AND/OR
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