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Tuesday, January 20, 2009


GOLD
Instead of me bragging about how great I am as in the last post, in this market although I have traded it profitably, my views of where it was going have been lousy. The red S followed by the dotted line down show the last trade I made which was a short with a nice profitable exit which is the bottom line. However, I have been expecting lower prices in this market and we have not gotten them.
The Weekly chart still shows lower highs so until that is broken we are in a downtrend, but a very choppy one that is hard to trade. There is not alot of commercial selling going on yet so that is one bearish factor that is not in place. If we look at the whole metals sector however, there is an overall bearish position by the commercials.
Ideally for me here I want a push up that serves up a false breakout that reverses down to get short or I will just sit and wait for this to clear up somewhat. There are always opportunities elsewhere. I want to shoot fish in a barrel not in the ocean, and this market is just sloppy right now.

4 comments:

Anonymous said...

It looks like you got the breakout you are looking for. Let's see if it comes back down to go short.

Chris Johnston said...

Well we definitely got the move up we will have to see if it is a false breakout or not. Some things I have are bullish here and some are not so this is not a great trading opportunity in my view right here. This is such a large range bar that it says stay clear for a bit. I have been influenced somewhat by one of my mentors who is bearish in this market and he has just been dead wrong so I am glad I have ignored him on this one. You always have to make your own determinations in trading regardless of who you might have learned things from.

Thomas Carolan said...

Chris,

Somewhat off topic: Do you see manipulation by commercials in the Silver futures market?

A guy named Ted Butler has been talking about it for years,
"The latest Commitment of Traders Reports (COT) continue to provide clear evidence of manipulation in COMEX silver. As of the close of business Jan 20, a new multi-year record was set in the percentage of the market held by the 4 largest short traders, at 48%. And when all spreads are removed from both the non-commercial and commercial categories, as is proper, the true net short position of the 4 largest traders runs over 66% of the entire COMEX futures market, the largest silver market in the world. "

Is this type of action unusual?
I know you are an expert at analyzing the moves of the big players and I'm glad to see you are continuing your blog. Thanks,
TomInLCV

Chris Johnston said...

I never break the report down that far on individual commodities. The only comment I could make would be to compare that to what is typically the case in that market. We have certainly not seen the type of price action in that market that would dictate anything funny going on, like we saw in Crude last year for example. However, it certainly would leave the market vulnerable to a sharp and fast move if those players were to exit. I am looking to short that market and there is nothing in the COT report the way I look at it that tells me otherwise.