Still in all the same positions. I may cry later about this GDX position. 
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New Gold and Silver Journal
- Thread starter actionzip54
- Start date
I looked at a big picture chart of Gold earlier today after I saw it being discussed briefly in another thread. At first glance it doesn't look like there is a large amount of down-side to current longs imminent, but I know if I was a big player, I would be taking note to myself that Gold is starting to look more and more like a good long for your average trader.
I'm not convinced we won't see a little more pressure exerted to shake weak longs for some decent liquidity for larger entities to put on profitable long-term positions in the face of a macro-trend change, and I think the charts support this as well.
Something that may be useful for you is to try to think a few levels above how you normally do. I don't remember who wrote it but someone said that they usually find chess players to be much more successful traders than poker players. I am inclined to agree. Here is an example; ask yourself:
1. "What am I [or your typical small-time trader] personally inclined to conclude from this data?"
2. "How likely is it that others could reasonably predict my conclusions?"
and then,
3. "How would they act to benefit themselves from knowing my initial inclination?"
and finally,
4. "How do I use all of this information to my advantage?"
I'm not convinced we won't see a little more pressure exerted to shake weak longs for some decent liquidity for larger entities to put on profitable long-term positions in the face of a macro-trend change, and I think the charts support this as well.
Something that may be useful for you is to try to think a few levels above how you normally do. I don't remember who wrote it but someone said that they usually find chess players to be much more successful traders than poker players. I am inclined to agree. Here is an example; ask yourself:
1. "What am I [or your typical small-time trader] personally inclined to conclude from this data?"
2. "How likely is it that others could reasonably predict my conclusions?"
and then,
3. "How would they act to benefit themselves from knowing my initial inclination?"
and finally,
4. "How do I use all of this information to my advantage?"
I looked at a big picture chart of Gold earlier today after I saw it being discussed briefly in another thread. At first glance it doesn't look like there is a large amount of down-side to current longs imminent, but I know if I was a big player, I would be taking note to myself that Gold is starting to look more and more like a good long for your average trader.
I'm not convinced we won't see a little more pressure exerted to shake weak longs for some decent liquidity for larger entities to put on profitable long-term positions in the face of a macro-trend change, and I think the charts support this as well.
Something that may be useful for you is to try to think a few levels above how you normally do. I don't remember who wrote it but someone said that they usually find chess players to be much more successful traders than poker players. I am inclined to agree. Here is an example; ask yourself:
1. "What am I [or your typical small-time trader] personally inclined to conclude from this data?"
2. "How likely is it that others could reasonably predict my conclusions?"
and then,
3. "How would they act to benefit themselves from knowing my initial inclination?"
and finally,
4. "How do I use all of this information to my advantage?"
I would agree and say that the chart looks bearish, but then again they all do when a market makes a bottom. Unlike, so many on this site and other places I don't like the trend and it's not my friend. My aim is to catch long term bull or bear moves and trade around positions as much as possible. Sometimes it takes me 10 losing trades to nail the bottom, or there isn't a bottom, the ones I do catch however more than make up for my losses. I personally think gold is on the verge of one of the greatest bull runs of any market for the next 10 years. Needless to say, I want to catch it.
The data I'm looking at shows "small-traders" as being net short, very net short. So are the hedge funds. most of the longs in this market are the physical players and commercial hedgers. In fact, using a historical basis almost no one owns gold. And by no one I mean mutual funds, retail players, hedge funds etc. Almost all market players, besides people forced into the market to hedge physical books, are out of the market or short. Positions are almost the polar opposite of where they were in 2011. Of course this isn't necessarily bullish all by itself, it often is though. I think the possibility of market weakness adds a whole other fold to this market because it increases the possibility of the fed backing off of tapering or even starting a QE 4 program. I would say it's starting to become obvious that Europe is possibly in a recession and that it could easily drag the U.S. along. What do you think the fed's reaction is going to be? Tighten money up? Doubt it. There is a very real possibility that I'm wrong and I'm just buying some pullback in a move down too $800 but the upside potential is much greater to me.
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Interesting perspective. Thanks for taking the time to share your thoughts; you've given me a few things to ponder. Either way, I think we both agree that it seems plausible that Gold could turn over into a long-term uptrend relatively soon. It will be a learning experience to see how things play out.
It's good to hear you have your own tried and true entry method; it sounds like you drop the losers quickly which is valuable skill in my book. Best of luck with your project!
It's good to hear you have your own tried and true entry method; it sounds like you drop the losers quickly which is valuable skill in my book. Best of luck with your project!
actionzip54
You and me trade very similar except I use a hedge, I stopped trading as you do long ago, losses mount up. Now I seldom have overall losing positions by using the options, but do need more funds to cover it all. Trying the find highs/lows is expensive, my longest been 23 tries of finding top in Crude at 147 in 2008, without the options, would certainly have little account. And it was very expensive too, margins way high and much prems on options. Do take 5k or 10k on half positions when it is offered?
I am still short Gold and added on spike up on Wednesday and hedged for maybe 1-2 more days, but long Silver, can't add any to it cause trend still down for me, but it is looking like going into trading range which means I will get stopped out at breakeven. Need Gold to get below 1182 to consider buying, looking for violent move down.
Still waiting for Copper to drop below 2.92, just making me wait for it, been short so long, usually forget when I got short.
I stopped COT long ago, for me waste of information, I stick to the charts.
You and me trade very similar except I use a hedge, I stopped trading as you do long ago, losses mount up. Now I seldom have overall losing positions by using the options, but do need more funds to cover it all. Trying the find highs/lows is expensive, my longest been 23 tries of finding top in Crude at 147 in 2008, without the options, would certainly have little account. And it was very expensive too, margins way high and much prems on options. Do take 5k or 10k on half positions when it is offered?
I am still short Gold and added on spike up on Wednesday and hedged for maybe 1-2 more days, but long Silver, can't add any to it cause trend still down for me, but it is looking like going into trading range which means I will get stopped out at breakeven. Need Gold to get below 1182 to consider buying, looking for violent move down.
Still waiting for Copper to drop below 2.92, just making me wait for it, been short so long, usually forget when I got short.
I stopped COT long ago, for me waste of information, I stick to the charts.
Interesting perspective. Thanks for taking the time to share your thoughts; you've given me a few things to ponder. Either way, I think we both agree that it seems plausible that Gold could turn over into a long-term uptrend relatively soon. It will be a learning experience to see how things play out.
It's good to hear you have your own tried and true entry method; it sounds like you drop the losers quickly which is valuable skill in my book. Best of luck with your project!
Thanks man. I always like to talk trading so your opinion is always welcome.
actionzip54
You and me trade very similar except I use a hedge, I stopped trading as you do long ago, losses mount up. Now I seldom have overall losing positions by using the options, but do need more funds to cover it all. Trying the find highs/lows is expensive, my longest been 23 tries of finding top in Crude at 147 in 2008, without the options, would certainly have little account. And it was very expensive too, margins way high and much prems on options. Do take 5k or 10k on half positions when it is offered?
I am still short Gold and added on spike up on Wednesday and hedged for maybe 1-2 more days, but long Silver, can't add any to it cause trend still down for me, but it is looking like going into trading range which means I will get stopped out at breakeven. Need Gold to get below 1182 to consider buying, looking for violent move down.
Still waiting for Copper to drop below 2.92, just making me wait for it, been short so long, usually forget when I got short.
I stopped COT long ago, for me waste of information, I stick to the charts.
It does sound like we have somewhat similar trading philosophies. I don't hedge much. I'd rather just start with very small positions and pyramid aggressively. I'm not sure what you are asking with the 5k to 10k question.
As far as the COT that is about 1/5 of what I'm using to make my sentiment decisions on gold. I don't think it is that great a tool when used solely on its own. I also use the Hulbert sentiment index, amount of rydex mutual fund assets devoted to precious metals, and a few others. I use internet forums as a less formal, less quantifiable way of measuring sentiment as well.
Excluding Weds (wide range day) and Thurs (inside day) volume has below average/trending down the last 6 trading days.
I myself would be cautious being long until there is more participation.
I think volume is important but I actually look for points of low volume to add positions. I'd rather look for a volume explosion and then buy or sell on a volume contraction in anticipation of a move further in the direction of the trend. That's only for adding to positions though. When trying to buy reversals I look for high volume moves. IMO when the big volume starts to come into a trade it's usually a top or a bottom.