The dichotomy between Gary and Doc's near-term views is fascinating. I don't know who will turn out to be right, but some mexican restaurant is going to make a fortune :-)
It isn't an if/or bet. I just know I'm no good at picking tops in real time. If I continue to push the long side I will just get caught in the IC correction when it comes.
Doc is probably better at picking tops than I am. As long as he's confident he can spot the top and avoid the draw down or is willing to hold through it, then by all means he should keep pushing for as long as he's comfortable.
Gold is congesting around 1730 and looks to continue lower shortly.
I'm waiting for it below 1700 and still intend to go 2x-4x (risking about 2% net worth) on a drop like that.
There is the argument that the low already happened 2 days ago and maybe I'll miss out or chase if so.
But there is still time for further down and the decline today (crushing about 20,000 contracts that went long at 9:30am) shows this thing isn't in 'easy money straight up' mode anymore. I smell more shakeout.
Actually, I'm pretty bad at calling tops in the stock market, and I've missed opportunities and taken some bad trades when trying to do so. Right now I'm watching gold, and everything I look at b/t gold and the dollar says gold has another bull daily cycle ahead. I am going to trade what I see, and there is no reason to let the equity market deter me when it doesn't even sport a weekly swing high.
TZ, have you ever done a backtest on parabolic sar? If you would have, you would find that the wins are only 45%. Not exactly a great % to build a long term strategy on. I have always said my system does use elements of sar but is using other parameters also. How would you explain my system when it holds wityhout a stop? Can sar do that?
I have been writing in my letter that gold needs to dip further... perhaps to a test of the 150DMA... in order to set a DCL. At that point I will look to position for the next daily cycle. So no burritos until gold significantly violates its 150DMA.
I posted this the other day, just thought I would re post it again for those who may have missed it, the only thing thats changed is the DC trendline is now higher than the 150dma.
"Just want to point out (besides trying to pin point it in realtime) a few significant levels im looking at for a DCL in gold now that the move into a DCL may be underway...
First of all, as I have mentioned many times in the past, a break of the 10dma this late in the timing band for a DC top almost always indicates that the move towards a DCL is in effect.
If the requirement for a DC trendline break is fullfilled, the 150dma and $1700 handle will be breached, they have basically all converged.
If the 150dma is indeed breached, below that we have both the C-wave 23.6% and the current Daily Cycle 38.2% Fib levels at $1673, which is also the 11/22 DCL pivot.
If that Fib level is breached (personally I dont put too much faith in them as hard support)we have the 50dma currently at $1664, which I have much more confidence in for a firm bottom.
If the 50dma is breached under heavy selling pressure we have the 200dma not far below, if this were the case most likely the 200dma (or slightly above it) will mark the bottom and give us a key reversal that will close at or above the 50dma.
A into B waves are even more tricky to navigate than D into A waves...one A-wave daily cycle or two? Maybe three! If two the second possibly fails and one is caught in a B-wave...you know the deal.
Wouldn't it be great if gold was just entering the bubble phase and the ABCD pattern was abolished?"
The dichotomy between Gary and Doc's near-term views is fascinating. I don't know who will turn out to be right, but some mexican restaurant is going to make a fortune :-)
ReplyDeleteIt isn't an if/or bet. I just know I'm no good at picking tops in real time. If I continue to push the long side I will just get caught in the IC correction when it comes.
ReplyDeleteDoc is probably better at picking tops than I am. As long as he's confident he can spot the top and avoid the draw down or is willing to hold through it, then by all means he should keep pushing for as long as he's comfortable.
Gold is congesting around 1730 and looks to continue lower shortly.
ReplyDeleteI'm waiting for it below 1700 and still intend to go 2x-4x (risking about 2% net worth) on a drop like that.
There is the argument that the low already happened 2 days ago and maybe I'll miss out or chase if so.
But there is still time for further down and the decline today (crushing about 20,000 contracts that went long at 9:30am) shows this thing isn't in 'easy money straight up' mode anymore. I smell more shakeout.
Is anyone here going to short Apple's parabolic move?
ReplyDeleteTZ
ReplyDeleteThx for the details. It was a wierd move this AM.
Tiho
I went short 10000 AAPL at the close in my paper trading account :-)
You be a brave man to risk that much imaginary money on one trade SF.
ReplyDelete>Is anyone here going to short Apple's parabolic move?
ReplyDeleteNo. You don't get rich by shorting.
Even the VERY few people on this blog who make SOME money by shorting know that statement is true.
The rest are simply gamblers or cant do math.
Actually, I'm pretty bad at calling tops in the stock market, and I've missed opportunities and taken some bad trades when trying to do so. Right now I'm watching gold, and everything I look at b/t gold and the dollar says gold has another bull daily cycle ahead. I am going to trade what I see, and there is no reason to let the equity market deter me when it doesn't even sport a weekly swing high.
ReplyDeleteGary, would you buy a Mortgage Backed Securities ETF such as MBB (http://goo.gl/PZFKS) if the Fed were to announce a QEIII by purchasing MBS's?
ReplyDeleteHey Eamonn, how's Ireland these days?
ReplyDeleteKAL, its always the same. The four seasons of weather in one day :o)
ReplyDeleteGary
ReplyDeleteLooks like, if things don't get better, that will will get a possible swing high in the SnP Friday. Will that change your labeling of jan 30 as a DCL?
I am very surprised with lack of movement in PMs with the news of lowering margins requirements.
Is there a *low risk* long trade here for gold bulls or dollar bulls? I don't think so. Read my profile.
ReplyDeleteSwing highs are mostly meaningless.Sometimes a swing low will mark a cycle bottom if it occurs in the timing band for one.
ReplyDeleteBut tops are notoriously hard to spot. Any number of swing highs could mark a top.
Gold appears to be tipping over now ... maybe Doc owes Gary a chicken burrito. Need a close below 1712. At 1717 now in late Asia, early Europe.
ReplyDeleteTZ, have you ever done a backtest on parabolic sar? If you would have, you would find that the wins are only 45%. Not exactly a great % to build a long term strategy on. I have always said my system does use elements of sar but is using other parameters also. How would you explain my system when it holds wityhout a stop? Can sar do that?
ReplyDeleteBill,
ReplyDeleteI have been writing in my letter that gold needs to dip further... perhaps to a test of the 150DMA... in order to set a DCL. At that point I will look to position for the next daily cycle. So no burritos until gold significantly violates its 150DMA.
SPX- JUST A THOUGHT , IF THE DOLLAR BOUNCES (and I'm not playing long dollar personally , it hasnt shown me anything but weakness so far)
ReplyDeleteORIGINALLY I DREW THIS MID NOVEMBER- AND "TRADED" 'LONG' (quick trades only)
http://www.screencast.com/t/HYhTSlz5r
MID DECEMBER- POSSIBLE INVERSE H&S WOULD FORM= BULLISH , but still scarey at first : ] (still quick 2-4ish day trades until January )
http://www.screencast.com/t/aSJwrqb0
NOW MAYBE THIS?
http://www.screencast.com/t/Q2n0zPJpCR
IF SO, THAT WAS JUST THE FIRST LEG...ENTER QE3
The commodities have made GREAT %-Gains...DO NOT miss the 2nd leg if this happens. Then you get this ; ]
http://www.screencast.com/t/bZRh4Aqj
We now have our gold DC trendline break, time to keep an eye on the 150dma.
ReplyDeleteGary,
ReplyDeleteYou can have my burrito again. ;)
I posted this the other day, just thought I would re post it again for those who may have missed it, the only thing thats changed is the DC trendline is now higher than the 150dma.
ReplyDelete"Just want to point out (besides trying to pin point it in realtime) a few significant levels im looking at for a DCL in gold now that the move into a DCL may be underway...
First of all, as I have mentioned many times in the past, a break of the 10dma this late in the timing band for a DC top almost always indicates that the move towards a DCL is in effect.
If the requirement for a DC trendline break is fullfilled, the 150dma and $1700 handle will be breached, they have basically all converged.
If the 150dma is indeed breached, below that we have both the C-wave 23.6% and the current Daily Cycle 38.2% Fib levels at $1673, which is also the 11/22 DCL pivot.
If that Fib level is breached (personally I dont put too much faith in them as hard support)we have the 50dma currently at $1664, which I have much more confidence in for a firm bottom.
If the 50dma is breached under heavy selling pressure we have the 200dma not far below, if this were the case most likely the 200dma (or slightly above it) will mark the bottom and give us a key reversal that will close at or above the 50dma.
A into B waves are even more tricky to navigate than D into A waves...one A-wave daily cycle or two? Maybe three! If two the second possibly fails and one is caught in a B-wave...you know the deal.
Wouldn't it be great if gold was just entering the bubble phase and the ABCD pattern was abolished?"
February 4, 2012 11:15 AM
WW,
ReplyDeleteI am showing the 150DMA at 1706.38. If this low of 1706.40 holds - that's pretty amazing :)
Good call
NEW POST
ReplyDeleteSo are we at the low now at 1706?
ReplyDelete