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Tuesday, December 6, 2011

POTENTIAL TRADE

A potential trade has been posted to the website.

120 comments:

  1. Twitter says for Noveber 6th Gary.. bought a DeLorean?

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  2. Your site seems to have crashed, needs more capacity, can't get in.

    thanks Nicklas

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  3. I'm getting a black screen as well.

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  4. I also can't get in. Call support, stat.

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  5. Covered my gold futures short at 1720. Gold found strong support on the 50dma.

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  6. WW don't like what being said about Geithner, promising money printing, went flat. Are you staying short? good post Alex thanks.

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  7. This gold bus I'm on is pretty spacious. Lots of seats.

    I see that WW is now looking to get aboard. Welcome my friend.

    :-)

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  8. Sorry I'm a bit chipper. My morning was crap for unrelated reasons, but now it looks like I pulled off a 4x long trade almost exactly at the lows.

    Makes up for things a bit.

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  9. This is why you don't short bull markets.

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  10. Booyah. Wow this feels good. Needed it.

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  11. Riley,

    I covered all my shorts, nice profits on the gold short from 1755. I went long gold futures at 1720.

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  12. As always I would like to stress the effect that SMA's have on gold price, today gold found a botton right on the 50dma. Covered part of my futures short on the 50dma and went long partially on the 50dma for a perfect entry.

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  13. Gold now has to fight the 75dma again around 1740 level, which may reverse gold.

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  14. A move like this looks like a recognition move. A chase.

    I think something just triggered and we're continuing up.

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  15. More importantly keep an eye on the HUI and GDX. If they both close above the 200 DMA that would be a positive sign.

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  16. Look at the 11/30 bounce directly off the 50dma, bounced up to the upper trendline from the 1923 highs (where I put on my short), rolled over and backtested the 50dma again today. The upper trendline is above the 75dma, keep an eye on both.

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  17. Miners don't seem to care that stocks are going nowhere. Everybody back in the pool? :)

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  18. Watching the HUI for a close above the 75dma also.

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  19. If gold reverses at the 75dma or the highs upper trendline, miners are going with it.

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  20. Correction to my earlier post, the 75dma is not at 1740, it is at 1735...and gold is close.

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  21. This has to be news based, it shot straight up. Anyone know what the news(rumour) is?

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  22. Gary and WW, please bear with me, I'm new to trying to read charts. On sharp charts it shows $58.60 for the 200 dma, is that correct?

    Thank you.

    Elaine

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  23. That's for GDX, sorry for not being more precise.

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  24. WW,

    Just curious, what timeframe charts do you use?

    I assume you are applying daily MA's to intraday charts for your analysis?

    thanks for your valuable contributions.

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  25. Elaine,

    For GDX that is correct. I believe it is more important to see if gold can break through this Upper trendline drawn from the 1923 high, which it has failed to do three times last week. This trendline reversed gold, and we may see it happen again...if gold reverses miners will follow.

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  26. gary, the premium site has crashed mate

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  27. Gold is higher by 20% this year, but the large-cap gold stocks -- Market Vectors Gold Miners ETF (GDX) are down 6% while the junior gold stocks -- Market Vectors Junior Gold Miners ETF (GDXJ) are down 25%.

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  28. Elaine,
    For future reference, near the top left side of the chart, you will see "MA (200)". Right next to that is the price for the 200MA.

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  29. Again, gold's bounce off the 50dma may be just that.

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  30. IMO the indicators, such as the MACD, are signaling that gold will most likely break upward. Silver is looking exceptionally strong.

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  31. GDX filled the gap. HUI still shows a little gap on stockchart. Think it got filled?

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  32. Looks like a triangular breakout on gold. Should drag silver along with it.


    Oh my!

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  33. Clark,
    the site is working for me.

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  34. james r said...
    Looks like a triangular breakout on gold. Should drag silver along with it."

    Silver has higher beta than gold...

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  35. This comment has been removed by the author.

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  36. > Miners don't seem to care that stocks are going nowhere. Everybody back in the pool?

    www.youtube.com/watch?v=1PmMFaVzbzc

    I don't see why not.
    It's no big deal.

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  37. Alex

    Thx for posting the GPL chart. You have awaken the crowd.

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  38. >Gold is higher by 20% this year, but the large-cap gold stocks -- Market Vectors Gold Miners ETF (GDX) are down 6% while the junior gold stocks -- Market Vectors Junior Gold Miners ETF (GDXJ) are down 25%.

    OA92000,

    I spend a couple of posts on that issue in the last thread. But I think you have been around a while and know my 'metal is beating' argument, right or wrong. The posts are still there with some charts otherwise.

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  39. Took off the gold futures long from 1720 at the 75dma, would like to see a break of the 75 before going long again.

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  40. seems to be fine now thanks

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  41. SF Giants Fan said...

    Alex

    Thx for posting the GPL chart. You have awaken the crowd.

    December 6, 2011 11:20 AM

    LOL...I was just hearing a lot of people saying its a real dog, but it went from .75 to $4.75 in 6 months last year...thats 600% and then some :) IT HAS TO consolidate to wipe out bullish overheating ( It has definitely wiped it out :)

    I rode it in OCT from $2 to almost $3 and sold 1/2. Thats almost 50%.

    The chart looks OK to me, it's just a matter of waiting for the miners to run continuously again, and I think GPL runs to $7 then.

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  42. Yea I was complaining. I picked up a few shares a few days ago. I'll give you the credit for the POP

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  43. Bloomberg interview with legendary Tom DeMark on why the S&P will spike higher... and then collapse http://bloom.bg/v7uWym

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  44. I don't know about this one...dollar is due for a bounce soon

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  45. This is why people continue to underperform the model portfolio. They can't pull the trigger at potential bottoms because they are worried about drawdowns. Our stops are close initiate are going to damage our accounts.

    However if you repeatedly fail to pull the trigger on entries then you are going to underperform or have negative performance during this period of time when trades are quick.

    I suspect most of this has to do with people ignoring rule #2 and using too much leverage.

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  46. the tough part is when to sell..

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  47. Are we still waiting for a swing low in the dollar?

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  48. I used to be able to buy with no problem especially when stocks are Cheap. I guess the fact that I am nervous should tell me something.

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  49. I don't use leverage. I'm a beginner though, and anything other than a clear TREND has me nervous.

    Gold is still in it's consolidation triangle. I see today as nothing more than another up after yesterday's down - net effect is sideways.

    The daily HUI chart is bi-polar. I refuse to trade it. Up/down/up/down/insane.

    GLD trends.

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  50. GLD just backtested the Dec 1st low. Trading for Dummies would say it goes down next.

    GDX hasn't exceeded the Dec 5th (yesterday) high.

    These are all easy to see on 60 min charts.

    I'm not saying anyone's wrong too go long, but I just see no TREND yet, so I sit in cash.

    FYI another good trader I follow just put 1/2 his net worth in UUP.

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  51. Bill,
    You are trying to trade like there is a strong trend. That hasn't been the case since May. Trading like that in this environment will just cause you to buy high and sell low.

    I think you can ignore the triangle, it's almost certainly going to be meaningless. A break to the upside isn't likely to to generate a strong trending move like you are looking for.

    In this environment one has to buy bottoms when it's hardest to pull the trigger and sell tops right about the time you start feeling comfortable.

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  52. Right now on the Gold daily we have a slanted head and shoulders forming from the 1535 low, if gold fails to regain the 75dma and the dollar continues to push higher I may look to put the short back on.

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  53. Some folks on this blog seem to be looking for the perfect trade. I used to suffer from that sickness and it prevented me from getting in the game. Of course, there are no losses but psychologically its important to get in the pool and build the trading muscle. The cause of this sickness is needing be right and not being able to admit, "I'm wrong on this trade" and take a loss. This lesson took me lots and lots of $$$ to learn.

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  54. Dicey if weakness carries us into the close. The SPX rejected yet again from the 200 day SMA, QQQ's and AAPL in the red, GDX and GLD repelled by the 75 day SMA.

    I like being nervous when taking a trade, but it's one thing when buying into panic selling and another when in "no man's land". I think I'm going to wait for the dollar swing to confirm direction.

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  55. Gary, I agree GDX doesn't trend, but GLD does. See the monthly, weekly and daily charts. GDX is exactly the opposite though, no trend at all, just up/down, so your strategy works for GDX.

    TrendTrader, I was like that, too. But a few other traders taught me to take on smaller positions, and that seemed to break the spell for me.

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  56. I am bullish on gold, but I think the triangle is important. Assume it's not, no worries for me to wait and buy at higher prices, because the trend is up. Gold will reach 2000 and 2500 and higher, so waiting for a break above 1767.10 is no problem for me.

    I am not bullish on GDX. I know all the reasons, but it's too much like the S&P, which is doomed to whipsaw a slow death spiral. Look at the 1 yr daily chart - it's a mess.

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  57. I myself want to be a trend/swing-trader. But like Gary says, nothing is trending, except $GOLD.

    $GOLD is trending.

    Look at the 3 yr daily chart, w/50 and 150d EMA's turned on. Just buy on the dips. Easy. Buy low, sell high.

    The current triangle looks similar to late 2009 / early 2010. One can see that buying the breakout worked then. I think it will work again.

    I'll start w/a small pos at breakout, then cost average up. I learned this from some good traders on this site.

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  58. Short gold futures 1733. Tight stop above the 75dma.

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  59. So embarrassed to ask, but when you set trade triggers to sell, do you set at the bid price or ask price?

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  60. FWIW... It appears the dollar has had 2 successful Head & Shoulders patterns. The first resolved downward and bottomed on Oct 28.

    Oct 28th was the peak of the second H&S (an inverse H&S). It resolved upward and peaked on Nov 25.

    Now the 50ma is developing an ugly looking curve, as if the dollar is about to roll over.

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  61. Pseudo,

    I have a "last" option, and I use that. Bid/ask are too widely variable. I want to see the trigger actually hit.

    Good trading,
    Le Fou

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  62. Danno,

    I wouldnt consider that a head and shoulders on the $DXY.

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  63. WW:

    Wow back on with the short huh? Anything new that prompted the trade?

    You still short SPX? I have to say, I expected a strong finish above the 200-day, if for no other reason than as a bull trap. The fact it's rejected the SPX twice now and we can't get a close above 1260 is disconcerting.

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  64. fwiw, note the chart on p.2 of the article:
    http://www.hardassetsinvestor.com/weekly-commodity-reports/precious-metals-monitor/3273-precious-metals-monitor-gold-chart-pattern-looks-strikingly-similar-to-2006.html?showall=&start=1

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  65. Ver,

    A number of things prompted the gold short again, for one the fact that the market couldn't make a new high or regain the 200, and the sell off into the close. Yes im still short the SPX, with a stop above the 200.

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  66. What I'd like to see is UUP open higher Wednesday morning, then close below today's close. That would produce one of those red engulfing candles that engulfs the previous day's red candle. That's what I was screaming about back in October. I've been waiting 2 months for it to happen again.

    It happened 4 times in October coming off the peak, and each time it led to significantly lower prices.

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  67. Thanks for sharing your discovery of what a reversal candlestick pattern is and its bearish implications

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  68. SB, Was that you that put a gold coin in the red kettle(Salv Army) worth $1800? You are a nice guy:)

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  69. This comment has been removed by the author.

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  70. Pseudopersona, I do the bid at less than or equal to desired exit price.

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  71. I think I shall switch to "last" after reading LA Fou and researching.

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  72. Listen to the whole thing and notice your feet at the end.

    www.vimeo.com/moogaloop.swf?clip_id=2539741

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  73. Do not use "last" for stop orders. Use some version/combination of bid/ask.

    I will let people try to figure out why on their own. It will be a good exercise.

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  74. My comment is only opinion and not professional advice. Reader beware as always. Clearly 'last' is an option and that is why they offer it.

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  75. Note also that trigger types differ frequently based on security type.

    For IB this is the page discussing the types and various defaults.

    www.interactivebrokers[PUT.DOT.HERE.TO.FIX]com/en/software/tws/usersguidebook/configuretws/modify%20the%20stop%20trigger%20method.htm?SearchType=Stem

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  76. My comment on 'last' is based on stocks which most of you guys are trading. For futures the default is 'last'.

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  77. For those who want a clue and will do the work on why last for stocks is a bad idea, I will post this sample chart of the trading of GDX near the end of the day today.

    imageshack[PUT.DOT.HERE.TO.FIX]us/f/171/gdxchart.gif/

    (yes, that includes after hours. NO it is NOT atypical to what will happen often during a normal day.)

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  78. Added some silver futures this evening with about a 50 cent stop. 32.55 is roughly support/resistance and we are back above it after a strong day. I think it will hold and go higher.

    Before going into today:
    a) I had sold the CEF I owned thinking we were going lower.
    b) I had sold most silver same reason.
    c) Gary was out.
    d) DOC was out

    Everybody was on the same side of the boat and looking lower.

    Markets do that at turning points and the retracement down towards 1700 here from the high last week is starting to look like nothing more than a pause or fakeout (that worked).

    Yes, the buying we did today could turn out to be the REAL fakeout and we may have been right to exit last week. Possible - you never know.

    If so we just take a acceptable loss and move on. It happens.

    However (I will mention in a later post) there is a working theory here shared by a few people that we are now in the 'late 78' equivalent period and that gold is progressing about to march relentlessly higher into its main momo phase - with few significant corrections going forward, at least for a while.

    With that possibility, I view betting some money on silver and 4x gold here to be a worthwhile risk.

    I think it will be easily clear in a day or so if this is right or not.

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  79. TZ,

    Thanks for the schooling re bid/ask vs last. Perhaps, if I used IB I could take of advantage of their double bid/ask options. As it is, I use last because a bid/ask quotes are often too wide and end up setting off the trigger prematurely. BTW, I use TDAmeritrade.

    Good trading,
    Le Fou

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  80. Fou,

    Weren't you the one who lost a bundle on a 'last' stop who get hit with a bad tick early in the year?

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  81. Yes, a bid/ask may be wide at times but at least it represents real buying and selling prices.

    A bad tick submitted from who-knows-what-company's computer feed that triggers your stop (and then gets reversed afterward) will definitely leave a scar.

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  82. Clearly, however, in ILLIQUID markets the use of bid/ask could be just as dangerous. Like options for example.

    Ultimately this game is about reading, thinking, doing your homework and understanding what is going on.

    Everybody is out for your money all the time and they will get it from those who don't do their homework. Nuff said.

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  83. PS: the spread on GDX during the day is usually 1 or 2 cents. So I have a hard time understanding how that presents some sort of 'too wide' problem.

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  84. TZ,

    You asked, "Weren't you the one who lost a bundle on a 'last' stop who get hit with a bad tick early in the year?"

    Not me.

    Best,
    Le Fou

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  85. Danno,
    Here's a couple significant H&S patterns I've been watching. Hope to see some follow through soon.

    $USD
    http://www.screencast.com/t/C4tjzRxr

    FXE
    http://www.screencast.com/t/67HKuOg77

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  86. Fairly compelling charts WR. May still allow another month before resolving. Here's what I am seeing...

    Dollar (Successful) Head & Shoulders
    http://stockcharts.com/h-sc/ui?s=$USD&p=D&yr=0&mn=11&dy=0&id=p78128812336&a=250432288

    Dollar (Successful) Inverse Head & Shoulders
    http://stockcharts.com/h-sc/ui?s=$USD&p=D&yr=0&mn=11&dy=0&id=p73244405053&a=250432366

    Dollar (potential) Double Top
    http://stockcharts.com/h-sc/ui?s=$USD&p=D&yr=0&mn=11&dy=0&id=p19218755097&a=250432415

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  87. Danno,

    you sure you aren't British?

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  88. This comment has been removed by the author.

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  89. This comment has been removed by the author.

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  90. I think the move up in gold yesterday was legit and the start of a strong up move, but this morning the algos are walking gold and silver down diagonally, almost in a stright line (you can draw it on a chart should you wish).

    They are stepping it down to try and find stops of weak buyers yesterday who chased on the way up.

    I've seen this plenty of times before. As long as the cost to slowly sell lower doesn't exceed the amount of money they make by finding weak stops the program will continue.

    It shouldn't get much lower than 1715 if the rally yesterday is real, before it stops. If everything retraces and we go lower then all bets off.

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  91. Today's McClellan Market Report is indicating a scary correction in gold coming

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  92. Well that's over. They can't take it any lower.

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  93. Eamonn:

    Would you elaborate? Thanks!

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  94. wmp: The spread between LIBOR and GOFO (London Bullion Market Association GOld FOrwards rate)
    has gone to its highest negative value in 22 years of available data. This negative spread signal has been a reliable sign that a meaningful down move is coming for gold prices.
    McClellan predicts a price plunge similar to the one that occurred in September.

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  95. "Selling them whiskey and taking their gold.

    Enslaving the young and destroying the old.

    Run for the hills - run for your lives!"

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  96. Prechter says deflation is coming:
    http://finance.yahoo.com/blogs/breakout/negative-mood-driving-market-prechter-140200467.html

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  97. Prechter has been saying that for 20 years. No one listens to him anymore unless they want to find the guy that can lose their money the quickest.

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  98. Danno,

    Iron Maiden FTW!!!!!!!!!!!!!!!!!!

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  99. Prechter is the lowest rated guru per Hulberts. A few of the other EW'ers are right next him. Good luck listening to those guys.

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  100. Arguably we have had deflation since 1979. Looking at the average price of houses, cars, and food we have had no inflation since.

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  101. You've got to be kidding. Since 79 the average house has gone from about $50,000 to about $180,000. Gas from about .80 to $3.50, etc. etc.

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  102. TenYear,

    I want some of what you're smoking.

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  103. It amazes me people still listen to Prechter. Just mind blowing.

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  104. LOL! Thought it might give you all a chuckle.

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  105. BEARISH pattern in $UUP and bullish pattern in $FXE forming

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  106. The S&P looks like it may be forming a coil.

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  107. WW,

    Where are you? When I don't see you post, I get to worrying. Hope all is ok by you.

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  108. This comment has been removed by a blog administrator.

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