I have changed my mind on how I want to trade in front of the Jackson Hole Bankers meeting. The report will explain. OVERVIEW we were filled at 1657 on the DEC EMINI GOLD. The situation remains open with a lot of variables as we have the Jackson Hole meeting on tap and the total focus will probably be there on the media outlets. The correction this week so far is choppy and overlapping and that’s a good sign as it favors that it’s not the main trend. That would favor there is upside after the correction completes. The one thing that makes all the difference is the Jackson Hole meeting. Just like the QE announcements, and the FED meetings, odds favor that some type of spike move is going to occur. I’ve been going thru this all night in my head. The question comes down to --- do I want to be long in front of a bankers meeting? The options market is skewed to the long side. That’s a concern. The crowd favors the upside. Last night’s daily update showed all the bullish banners everywhere. The advisors favor the upside. The short term cycle while it can invert and the window is open until Friday, favors lower into mid September. A cycle inversion is about a 25% chance.
The question becomes is it better to be long in front of them and risk a loss or is it better to let the market make the move and try and get on board once it makes its move? I have always tried to spin to the conservative side and that means avoid losses. And I must admit, as we get to the meeting I have mixed feelings. When I remove the feelings, I’m left with a crowd that is betting on the upside and is bullish about the outcome, a short term cycle that favors the downside by 75% and a bankers meeting that the whole world is waiting on. Now it’s obvious they have to do something and certainly once the move happens, if gold is up 100 dollars, we’ll say ----damn, it was so obvious, why wasn’t I long. On the other hand, if it drops 100 dollars we’ll say ----damn, I should have known with everyone so bullish that no matter what the decision was going to be that the crowd was going to get hit. Gold Hourly Chart Price is currently sitting on the purple line and the gold/yellow channel lines. There is only one other support near 1650 and then the 1640 area where the last support before 1620 exists. Part of the strategy was to buy a second position at 1645. That would give us an average price of 1651 but would be holding two positions. The favored pullback price area is the 1655 zone. However it’s not the only place it has to stop at. In summary odds favor a pullback is in play that has one more push lower to go. There is also the potential that the cycle turn due this week is in play and the pullback is going to be a two week affair. But it’s too early to say which one yet. But that is my one concern being the potential for a two week pullback to come in play instead of a fast pullback and higher.
The chart pattern is choppy and overlapping and that does favor that this is only a correction. The problem we are dealing with is that an outside force like this meeting and the results are not one you can go to the charts with and figure out the odds. Even watching the charts over the past 12 hours one can sense uneasiness in the trade. Tonight it seems like hesitation.
Cycles the next short term cycle is a natural cycle that has been going on ever since the earth has been here and will continue to be with us. If there were no variables to this cycle, it would not work and the Greeks would have cornered the Olive Oil market 2000 years ago. Because it has variation is why it continues to work. The chart below shows what happens when the blue cycle is in play. It has not missed
a downturn this year. Some are better than others, some barely work. The April cycle was a messy one and this one could very well look like that if we were to turn around by the end of this week. And the potential is much greater because of the outside forces for it to be skewed. It could also look like the May one. That was a FED meeting turn. Let’s go to the next chart to see what a cycle inversion would look like.
Cycle inversion If we were to get a cycle inversion, it could look like this below. Before you too excited keep in mind the MAY example I gave you on the first chart and that cycle inversions happen on average two to three times a year. The last real inversion happened one year ago next week when the correction began in gold. The bottom line is that as far as the odds go, the odds favor that we’re going to go lower. The consideration is this. Odds are odds and when one bets against them and is CORRECT, the REWARD is great. The reward is great because the risk is
great. In other words, if the move is to the upside and you’re long, it will be a good day. If the move is to the downside, your day will not be so good.
If you are short the same applies. If you are conservative, you do not participate. You have no great reward, nor a great loss. You simply let the aggressive and the risk takers do their thing and once the dust clears, you resume your trading. There is room for all types of traders. A conservative trader doesn’t lose as much or as fast. I’ll bet you thought I was going to say doesn’t make as much as fast. Since 90% of commodity traders lose their money the opposite is the case here. Thus there are two trade Strategies listed tonight: CONSERVATIVE STRATEGY
AGGRESSIVE STRATEGY CONSERVATIVE TRADE STRATEGY – GOLD Instructions Exit the market, stand aside and wait until next week to trade. Trading could also resume after the big spike occurs when a reasonable support or resistance area is met and when the market stops its wild gyrations. What about missing a move ? There was trading 30 years ago --- there will be trading 30 years from now. Trading has nothing to do with price. It has only to do with entry and exit techniques. The price of gold can be 300 or 3000. It matters not. Missing a move is more of an investor’s definition. Trading is not investing it is trading and it is highly leveraged. I know of no investor who uses trading as his investment vehicle other than those who get wiped out trying to follow a market instead of focusing on entry and exit techniques. Your experience may be different. I am just sharing mine with you. Since 90% of all traders exit without enough money in their account to trade and since I have wiped out accounts in the past, I tend to use a conservative approach. Trading against the bankers and with the crowd is not conservative. There is no doubt that an aggressive trade that is on the right side of the move can make a nice chunk of cash in a short amount of time. Risk/Reward works that way. The greater the risk, the greater the reward.
I HAVE DECIDED TO TAKE THE CONSERVATIVE ROUTE AND LET THE MARKET DO ITS THING WHILE I SIT AS A BY STANDER. THE WEBSITE IS CURRENTLY LONG 1 DEC MINI GOLD AT 1657 ------------ I HAVE PUT A BREAK EVEN STOP ON THE POSITION AT 1657 I WILL MOST LIKELY SELL THE POSTION IF IT RALLIES INTO THE MEETING. IF and WHEN I DO SELL IT, I WILL NOTIFY THE DIST LIST. I HAVE CANCELLED MY OTHER BUY POSITION AT 1645 in gold and the position in SILVER to go long. I’ve cancelled all stop orders except the break even on the Mini gold. I’ve left the original position below for those who want to pursue the trade. This strategy could be a big winner. IF GOLD DOES NOT TRADE AT 1630 and rallies, the trade will be successful. IF IT IS STOPPED OUT AT 1630 --- THE TOTAL LOSS WILL BE 42 dollars for every ounce of gold you have in the position. NOTE: THE TRADE BELOW IS NO LONGER PART OF THE WEBSITE TRADE HISTORY. THE HISTORY WILL REFLECT THE ONE TRADE ABOVE of both the entry and the exit. Finally --- there is no right or wrong. One size does not fit all in trading. Keep in mind the trade below is AGGRESSIVE LONG TRADE. BEING ON THE SHORT SIDE would also be an aggressive trade. For those who continue in the trade – I wish you success and will be cheering if the trade is successful. IF IT IS SUCCESSFUL ---- I WILL POST AN EXIT STRATEGY FOR THOSE WHO ARE IN THE TRADE. I can only trade what I feel comfortable trading. And I’ve never been comfortable in front of the bankers meeting. I will have my finger on the keyboard and I’ll be watching.
The question becomes is it better to be long in front of them and risk a loss or is it better to let the market make the move and try and get on board once it makes its move? I have always tried to spin to the conservative side and that means avoid losses. And I must admit, as we get to the meeting I have mixed feelings. When I remove the feelings, I’m left with a crowd that is betting on the upside and is bullish about the outcome, a short term cycle that favors the downside by 75% and a bankers meeting that the whole world is waiting on. Now it’s obvious they have to do something and certainly once the move happens, if gold is up 100 dollars, we’ll say ----damn, it was so obvious, why wasn’t I long. On the other hand, if it drops 100 dollars we’ll say ----damn, I should have known with everyone so bullish that no matter what the decision was going to be that the crowd was going to get hit. Gold Hourly Chart Price is currently sitting on the purple line and the gold/yellow channel lines. There is only one other support near 1650 and then the 1640 area where the last support before 1620 exists. Part of the strategy was to buy a second position at 1645. That would give us an average price of 1651 but would be holding two positions. The favored pullback price area is the 1655 zone. However it’s not the only place it has to stop at. In summary odds favor a pullback is in play that has one more push lower to go. There is also the potential that the cycle turn due this week is in play and the pullback is going to be a two week affair. But it’s too early to say which one yet. But that is my one concern being the potential for a two week pullback to come in play instead of a fast pullback and higher.
The chart pattern is choppy and overlapping and that does favor that this is only a correction. The problem we are dealing with is that an outside force like this meeting and the results are not one you can go to the charts with and figure out the odds. Even watching the charts over the past 12 hours one can sense uneasiness in the trade. Tonight it seems like hesitation.
Cycles the next short term cycle is a natural cycle that has been going on ever since the earth has been here and will continue to be with us. If there were no variables to this cycle, it would not work and the Greeks would have cornered the Olive Oil market 2000 years ago. Because it has variation is why it continues to work. The chart below shows what happens when the blue cycle is in play. It has not missed
a downturn this year. Some are better than others, some barely work. The April cycle was a messy one and this one could very well look like that if we were to turn around by the end of this week. And the potential is much greater because of the outside forces for it to be skewed. It could also look like the May one. That was a FED meeting turn. Let’s go to the next chart to see what a cycle inversion would look like.
Cycle inversion If we were to get a cycle inversion, it could look like this below. Before you too excited keep in mind the MAY example I gave you on the first chart and that cycle inversions happen on average two to three times a year. The last real inversion happened one year ago next week when the correction began in gold. The bottom line is that as far as the odds go, the odds favor that we’re going to go lower. The consideration is this. Odds are odds and when one bets against them and is CORRECT, the REWARD is great. The reward is great because the risk is
great. In other words, if the move is to the upside and you’re long, it will be a good day. If the move is to the downside, your day will not be so good.
If you are short the same applies. If you are conservative, you do not participate. You have no great reward, nor a great loss. You simply let the aggressive and the risk takers do their thing and once the dust clears, you resume your trading. There is room for all types of traders. A conservative trader doesn’t lose as much or as fast. I’ll bet you thought I was going to say doesn’t make as much as fast. Since 90% of commodity traders lose their money the opposite is the case here. Thus there are two trade Strategies listed tonight: CONSERVATIVE STRATEGY
AGGRESSIVE STRATEGY CONSERVATIVE TRADE STRATEGY – GOLD Instructions Exit the market, stand aside and wait until next week to trade. Trading could also resume after the big spike occurs when a reasonable support or resistance area is met and when the market stops its wild gyrations. What about missing a move ? There was trading 30 years ago --- there will be trading 30 years from now. Trading has nothing to do with price. It has only to do with entry and exit techniques. The price of gold can be 300 or 3000. It matters not. Missing a move is more of an investor’s definition. Trading is not investing it is trading and it is highly leveraged. I know of no investor who uses trading as his investment vehicle other than those who get wiped out trying to follow a market instead of focusing on entry and exit techniques. Your experience may be different. I am just sharing mine with you. Since 90% of all traders exit without enough money in their account to trade and since I have wiped out accounts in the past, I tend to use a conservative approach. Trading against the bankers and with the crowd is not conservative. There is no doubt that an aggressive trade that is on the right side of the move can make a nice chunk of cash in a short amount of time. Risk/Reward works that way. The greater the risk, the greater the reward.
I HAVE DECIDED TO TAKE THE CONSERVATIVE ROUTE AND LET THE MARKET DO ITS THING WHILE I SIT AS A BY STANDER. THE WEBSITE IS CURRENTLY LONG 1 DEC MINI GOLD AT 1657 ------------ I HAVE PUT A BREAK EVEN STOP ON THE POSITION AT 1657 I WILL MOST LIKELY SELL THE POSTION IF IT RALLIES INTO THE MEETING. IF and WHEN I DO SELL IT, I WILL NOTIFY THE DIST LIST. I HAVE CANCELLED MY OTHER BUY POSITION AT 1645 in gold and the position in SILVER to go long. I’ve cancelled all stop orders except the break even on the Mini gold. I’ve left the original position below for those who want to pursue the trade. This strategy could be a big winner. IF GOLD DOES NOT TRADE AT 1630 and rallies, the trade will be successful. IF IT IS STOPPED OUT AT 1630 --- THE TOTAL LOSS WILL BE 42 dollars for every ounce of gold you have in the position. NOTE: THE TRADE BELOW IS NO LONGER PART OF THE WEBSITE TRADE HISTORY. THE HISTORY WILL REFLECT THE ONE TRADE ABOVE of both the entry and the exit. Finally --- there is no right or wrong. One size does not fit all in trading. Keep in mind the trade below is AGGRESSIVE LONG TRADE. BEING ON THE SHORT SIDE would also be an aggressive trade. For those who continue in the trade – I wish you success and will be cheering if the trade is successful. IF IT IS SUCCESSFUL ---- I WILL POST AN EXIT STRATEGY FOR THOSE WHO ARE IN THE TRADE. I can only trade what I feel comfortable trading. And I’ve never been comfortable in front of the bankers meeting. I will have my finger on the keyboard and I’ll be watching.
AGGRESSIVE TRADE STRATEGY – GOLD Instructions: ENTER LONGS ON PULLBACKS -- buying 1657 and 1645 Dec Mini Gold. RISK – If Jackson Hole is a bust – or if the control boyz have other plans, we can get stopped out and a gap down or up scenario is possible. When prices gap --- all stop loss orders are filled at the low or first area where there are willing buyers. In other words, it can be at a much lower price.
NOTE: The trade strategy below is no longer a website trade. It is an aggressive trade strategy for the long side and a consideration for those who want to be aggressive in front of the Jackson Hole meeting.
