Strictly Necessary Cookie should be enabled at all times so that we can save your preferences for cookie settings.
If you disable this cookie, we will not be able to save your preferences. This means that every time you visit this website you will need to enable or disable cookies again.
Great post as usual! I think next week will be a good time to buy gold if for no other reason than the Chinese will be back from holiday. http://www.zerohedge.com/news/2016-10-09/theres-one-very-simple-reason-why-precious-metals-were-pummelled-week
If the SM does correct into an ICL, do you not think it will take the miners down with it? Or at least limit the upside?
Nah, I think miners will follow gold.
I doubt we are going to get any serious downside in stocks ahead of the election, but I also doubt we have much chance of a trending move to the upside that would allow one to make some money. It’s probably going to be a day traders market into the elections.
Gary,
You have misrepresented what I wrote, just as people misrepresent some of your posts.
To be clear, you have strongly encouraged the following strategy:
Buy anytime, hold old turkey, then cash out huge profits in 4-5 years.
I maintain the following strategy — AND NO OTHER:
For precious metals, trade DC’s and IC’s if you detect a favorable entry for a high probability setup, with clear indications to confirm or negate your position. Trade even shorter time frames, IF you are comfortable doing so, based on your assessment of probabilities and risk management.
So as you can see, even if YOUR bullish outlook turns out to be correct, you can make just as much profit or even more (by avoiding the drawdowns), with the DC/IC trading strategy vis a vis old turkey.
So why add the UNNECESSARY risk of holding thru intermediate and yearly cycle declines, when you can make equal or greater profits, while simultaneously reducing your risk?
Same market outlook, same forecast, with less risk.
To tie up another loose end:
Let’s cap that rolling 4-5 years. Since 2016 is in its final quarter, we’ll call it by year end 2021 — you say PM’s will be in the parabolic blast off phase by December 31, 2021 — if we don’t cap your “4-5 years”, it could keep rolling into the future forever. In a few months, 2021 becomes 2022… then 2023… and so on.
While that outcome is possible, I believe it’s unlikely.
But to be clear, and not misrepresented again: I AGREE WITH YOU, there’s still plenty of profits to be made on bullish moves in precious metals — if one makes their decisions based on probability assessment and risk management, using a strategy that’s not only profitable, but also that does not introduce unnecessary risk into the equation.
PS: And to remind people, your successful PM’s trading in 2016 (congrats on that!) was due to trading DC’s and/or IC’s — NOT OLD TURKEY!!!
Well the big reason to go Old Turkey is to move your trades into the capital gains tax rate.
There is no way you or probably anyone else will outperform an Old Turkey strategy over the full course of the bull market unless you use leverage. Of course the drawback to that is as we’ve seen a mistimed trade is painful.
I challenge anyone to make real time calls with position sizes and I think I can say with a great deal of confidence they will underperform an Old Turkey strategy. Then when you add in the fact that Old Turkeys aren’t paying any taxes there is almost no chance any of you will beat the Old Turkeys.
I’m going to try to do it by trading leverage but I’m not at all confident I will be ahead when we get to the final bubble phase.
Thank you Alex for the comment on oil, value your opinion very much… I think oil will give us another dive surprise soon on Italy election, France, out of media begging for money Greece, you know more …, plus situation with Russia…, I never seen oil up to 60$ as Gary hope. The best for oil is a range 49 – 42, but I will go lower to 36 I think. But let see election first…
Thanks Gary!
yeap, indeed, Victor. Let’s see the elections.
As the short-selling master Jim Chanos has recently said: “Trump […] my easiest short, like ocean liners hitting icebergs.”
Stocks market should have moved to new highs after jobs report on Friday.
Its failure alongside quickly souring market breadth are indicative a destructive forces ahead: most likely Lady Market is getting started to discount a Trump win.”
Regardless of the reason for this budding distribution, I’ll buy SPXU today.
Silver has a swing
…still waiting to time my short.
OPEC’s decision has done wonders to crude today and afflicted stocks too.
CRB index is on day 16
You can participate in the beautiful oil bull or you can wait for the next 6-9 months of Gold bull consolidation.
The 15 ratio is coming boys and it is gonna kill the Gold stocks or at least make them severely underperform the oil stocks.
Vladimir Putin’s words 1 hour ago have put oil on fire:
https://www.rt.com/business/362241-putin-oil-production-opec/
Bearish divergences are popping up.
nice oil shorts turned into nice loss, going to wait for better entry…
And I was right too !
Hi Alex!
I was meaning to get to your question from Friday — and a couple of other observations.
First, on the poker — you should give it a go, especially since you have disciplined risk management skills. A poker tournament is another market, but it moves much faster than financial markets — each hand is akin to a swing trade or day trade.
After our chat last week, combined with watching the World Series of Poker, participating in the friendly charity tournament, and Friday’s employment report, I arrived at a huge strategy conclusion: Don’t bet on an outcome. People go all-in for coin flips in poker, and people bet on a particular outcome — employment report, Brexit, ECB, BOJ, Fed, etc. Unless you have mathematical indication of a high probability of one outcome over another, do not put yourself at risk betting on an outcome. Play the hand as it unfolds, trade the market as price action evolves, but do NOT bet on one outcome. Huge for me. My poker tournament with the $3 buy-in helped me come to that realization. I put an average of $7.50 at risk to play each week — extremely low risk, and lots of fun while learning and developing practical strategy — which is my weak area (though not for long!)
As for the triangles, Elliott’s technique for drawing triangles is the one I use, and it’s the best I know of. Jody Samuels gives an Elliott Wave tutorial on youtube, and her module 3A deals with corrective patterns — I recommend it!
Of course, the key is pattern disambiguation, which usually manifests as: Will the triangle break out or break down? Using my scientific approach I have been alluding to since late last November, I can mathematically predict which wave in a triangle is wave C, more than 9 times out of 10, and everything follows from there.
Even before discovering the scientific approach, I had a hunch that if you could figure out wave C with high probability, then that’s where you should take a position, with extremely low risk, because waves D and especially E can play out much more quickly than waves A, B, and C. Wave C is almost always determinant, and indicated in real time.
Finally, these statistical signatures also indicate whether the current pattern is corrective or impulsive, with high probability. For example, when you got stopped out of NEM with a small loss on Friday, I would have recommended that you wait for a dead cat bounce to exit with a small profit because my indicators were telling me that Friday’s (1) gap up, (2) reversal, and (3) the second reversal were ALL corrective moves. In fact, the peak in GDX just after open on Friday suggested — TRIANGLE!
If you discover your trading thesis was incorrect, there are two ways of getting stopped out, I believe. If there’s a strong (impulse) move that goes against you, then sure, you want to get stopped out immediately using stop loss. But if the move is corrective, there should be a bounce (or pullback) that would allow you to stop out at break even or a small profit, after which you can re-evaluate.
I am not short the S & P nor other stuff. Am just wondering.
You guys all those days have been writing how declining market breadth is foreshadowing a smaller or bigger drop in the market. Well, not only You. But it is rising and doesn’t care about anything
Oil is also up, the metals not really..are just treading water…the dollar is stubbornly rising against all the odds and doesn’t care about the bearish gartley pattern nor about lower intermediate lows
How often does technical analysis actually pay off? 60 or 70 % of the cases?
I mean with all this manipulation in the markets, does technical analysis really work? I am just asking because You guys are clearly a hundred times better with this stuff than I am and still failing.
Nobody? Well, forgive my naive stupidity! Didn’t mean to insult the technical analysts.
Hi Amantede,
I am quite experienced with tech analysis and trading. And my conclusion is – no it does not work, have you ever seen really wealthy technical analysts…?
You can’t basically predict where markets are going, you have to be open to all possibilities and manage your trading accordingly.
Long-term there is always asset inflation, therefore you should not try to make money on the short side (Gary really taught me this) and instead strive to be long over extended periods (forget short-term trading), and try to time those longs with good entries (when every tech analyst tells you to go short for instance:)).
My sentiments exactly. If technical analysis worked consistently every Tom Dick and Harry would be rich. And today we got another example of why selling short will just cost one money in the long run
Dear ZKOT, thank you very, very much for your having taken your time to write that up for me!!!
1) yes, indeed, playing reports with full positions would be madness. I never do that. I go for a maximum of 50% of a full position IF, as you say, there is a high probability of things getting reported as I think and IF the market setup provides room for such a maneuver.
For instance, I rarely take a position in a stock before its earnings report and if I do, I am EXTREMELYY CAREFUL AT HOW THE MARKET REACTS 5 MINUTES BEFORE OPENING. If I see selling pressure, I dump it, regardless how good the report is.
But otherwise, I have entry after DCL or HCL in stocks and when the stock is many weeks away from the next earnings report.
2) Indeed, I was expecting some sort of dead cat bounce in NEM and miners and that’s why I dumped it at 34 after it had its low of the day at 33.56.
But I must admit that I play these intraday bounces based on gut-feeling, not on a strategy, as you are suggesting.
That’s why I thank you again! I hope your suggestion to watch Jody Samuels will cast a light into a new filter for me.
I still do not understand what waves D and E are about since I know that Elliottism is about 1-5 impulses and A-C corrections but I’ll hope Jody will teach me in her youtube tutorial.
Cheers, mate!
I checking out from my computer today to play with my kids 🙂
Hope to see oil even higher tomorrow on IEA’s report at 10AM Paris time and cast my short-stocks trade tomorrow 🙂
Short SPX at the close via SPXU.
Tomorrow or the day after I’ll add to a full position.
PS: Amante, you have not read Chapter 6 of Van Tharp’s main book. Had you read, you would not have made that comment. Things would have been clear.
You are right Alex, I haven’t done that yet. Instead I have been reading articles about the destructive effects of the US-Navy’s military weapons testing on ocean wildlife…absolutely disturbing…well, and other environmental stuff. I’m with a Spanish conservationist’s blog.
Just so that You know. 😀 😀
Both consumer staples and utilities have completed their ICLs while offensive stocks are topping – volatility is about to increase, dreadful moments for broad indexes lie ahead. Seatbelts on!
I really doubt the government is going to allow any kind of serious correction in the stock market ahead of the election.
51.20 = crude oil –> now it is time to short with a pilot position or at least, if I were an oil trader (I dislike trading oil – too volatile), I would be short.
Oil has put a double top while it proves unable to break to higher ground DESPITE OPEC’S AND RUSSIA’S EXTREMELY BULLISH ASSERTIONS!
That’s very bearish.
Full position is worth being implemented after tomorrow’s OPEC Mthly Rep + inventory data
Amante, that’s a very nice activity. I congratulate you for your interest.
I am too lazy to go full monty…I prefer only giving money for those who do the good environmentalist job.
Hello Gary. I’m a long term reader of your board and videos, and must say I have enjoyed them immensely.
However, what made me subscribe and post, is that you have made no comment on where we are now with the dollar? A while back in a video you said there was virtually zero chance of the dollar index topping the July high and then went onto say probably the August high as well. When is the “watershed” moment going to come and people realize they are on the wrong side of the trade and the dollar plunges,like you said, because what is going on in Europe, Britain and now South Africa makes me think its not going to happen anytime soon and the dollar is only going to get stronger. Regards, Billy.
GARY, I think we will see a DCL in stocks by the time of elections (most likely also an ICL) whereas the DCL after, sometime in January, will also be ICL and YCL – a shortened IC.
So Gary,
what is happening to the dollar here, is this the high or what…?
Thanks!
You oil bears will get slaughtered… another draw this week my friends , I ain’t shorting until 60$ and then we will get a retrace to around 52$ but not before February!!!
Yeah think the same here.
we get $60 minimum in the next 3 months.
I guess the dollar shows what Rick Ackerman would call an impulse leg. The dollar is now conquering one external peak after the other. I think it will also get about the next external peak which is just a couple of cents away. I found that such resistant levels marked by peaks exert magnetic attraction once the direction is established.
What I don’t understand, though, is how oil can still get up and up against the dollar. Not that I am short, am just curious.
Now, thinking about conspiracies and price manipulations: Could someone manipulate the dollar in order to put pressure on precious metals so they can aquire more of them? It would make a lot of sense in the case of the PGMs and even silver, also a bit in GOLD (although there is already a lot of this stuff laying around).
The negative correlation between USD and Oil is a myth. Sure, it has happened for a few extended periods.
But the opposite has also happened for extended periods.
Even when there is a correlation it requires a lot of imagination to see it.
For example from 2004-2008 the USD index declined from 81 to 71 a 13% decrease.
Oil went from $30 to $148, an almost 400% increase.
Sure it was in the same direction but a correlation, really?
Thanks Duck.
That helped.
SPX short at a full position now.
I am not shorting oil.
I NEVER trade oil or anything too volatile (i.e. ATR>5%).
Good luck Alex. The VIX as well as VIXF is picking up. Seems someone is at least getting ready for some downside.
DAVID SILVER, look at SPX and miners!
Now you have a real-time proof, the best proof – PRICE ACTION – of what I answered you to your question: “why did you sell NEM if you believe an ICL is round the corner?!”
My answer on Friday was that I saw stocks hitting ground and that in such an environment it is not safe (probabilities do not favour anymore) being long in any stock since we cannot anticipate the effect of the braod market down fall on miners.
And… here we are! 🙂
Yes sir Alex today’s tape action doesn’t look very well per the US stock market.
So you are long gold here @ 1259?
😉
Thanks, Amante!
And do not forget: I used to be a tyro too and a very diligent one persisting in turning my trading accounts bust as many as 3 times before I realized I had only one avenue: become a diligent student of markets, so that I started to read, read and read.
You do not HAVE TO get the same experience, you can get emotional maturity easier, by starting to read now.
Otherwise, you WILL NEED TO get the same sour experience to learn: to hit rock bottom to reach Enlightment.
So, start reading now or you’d better close your trading account with what you have left (I am confident you are at a loss) so that you do not lose it all.
…I checking out from my computer. There is nothing worth watching at Lady Market for today.
Ta-Ta!
Are u happy now for misleading people on direction of gold?
miners getting killed and someone said gold going to 1377.
Yeah right!
Well, I actually got a kind of bulletproof way of making money. But the problem is that You make only veeeeryyyy small money 3 or 4 times a year. Which would normally be enough for me. I came here because I got blinded by greed. People were making sooo much money this year in PMs etc. that I wanted to participate. And now I am at a loss because I thought I could outsmart the market. Too bad.
Also, someone bet burritos as if they didn’t have enough money to buy better foods.
Don’t be stupid all your life its satire, not that I think you even know the meaning of the word without googling it.
burrito bill – why don’t you google – “baboso” better yet you are now “bbb” – burrito baboso bill
relax gent.., your sentiments indicate bottom is here …, and don’t blame someone for your fault, read as Alex are saying, if you would read the book he suggesting you would see trading differently, guaranteed.
GOLD = 1259 –> I have a significant long position in it via UGLD.
I’ll add to it tomorrow as we receive confirmation that YCH in USX has been put (>97.62) in Asian trading and a perfect bull trap for dollar lovers.
PS: Amante, it is normal for a trading strategy to work only seldom. That you have brought up this issue also reflects you have hurled yourself in the markets w/o reading trading literature.
No and Yes, Alex. I haven’t read much stuff, instead I watched a lot of stuff on You Tube and listened to a lot of people. I still consider myself a beginner.
You misunderstood me, however. This what I do has so far worked for me. It’s safe and boring, not as sexy and lucrative as trading oil, PMs, shorting etc. I closed the 4th successful trade in a row today actually. 🙂 But You make only peanuts. 😀
And my balance would be green this year if I had not become blinded by greed.
I just can’t really believe that technical analysis really works because the big banks have all the information at any moment in realtime. They got algorithms and high frequency trading, immense resources and so many bright people. They see all the options we buy, everything. How could we ever outsmart them? 😀 They buy the financial media and fool the small people any time. Furthermore they play with other people’s money, so they don’t have pressure ever. If it goes wrong, well who would really care? Law protects them.
DAVID SILVER, yes, I am long gold at 1259 –> it is the first time I buy gold (w/o counting the pilot in NEM on Friday) after dumping it at 1337 in early July, more than 3w ago 🙂
Stocks ordeal is not just today’s bad tape action.
LOOK AT THE FOLLOWING OFFENSIVES:
– biotechs are leading the decline by being CLOSE TO DELIVERING A FAILED DAILY CYCLE – the first offensive close to do so,
– semicons, russell 2000, consumer discrationaries and financials are in confirmed daily cycle declines (swing highs and daily cycle trend lines broken),
– furthermor Russell 2000 broke decisevely its 50dma and is close to producing a weekly swing high also !
WE ARE IN YEARLY CYCLE DECLINE!
WE ARE TO SEE A DEAD CAT BOUNCE AFTER ELECTIONS (markets buoying on Hilary’s success to come).
Watch out, David!
Now the only places to be long are treasuries and gold.
Now, I am really checking out! 🙂 good night.
it’s 19:42 in Bucharest, Romania and my kids are awaiting me 🙂
Wow, Alex…You practically live around the corner of my place.
👍❤️
so, Friday ??
http://www.bloomberg.com/news/articles/2016-10-11/a-7-trillion-moment-of-truth-in-markets-is-just-three-days-away
another 4 wks? http://stockcharts.com/h-sc/ui?s=GDX&p=D&b=5&g=0&id=p42124237554
Hi Gary nice work .
I would like to know what you think about uranium stocks on a technical basis . are they forming bottoms?
I’ve never followed uranium stocks, and know nothing about them. Sorry.
Regis. I would say that they are bottoming or hitting it right now. Problem is, however, that a bear market in uranium may take a decade.
The fundamentals are compelling but people don’t care. There are a lot of reactors coming online. People like Marin Katusa and Rick Rule have been trying to talk this market up for years and it has been going down nevertheless. It has to do with Fukushima.
IIf You wanna gamble just put a couple of hundred $s in Cameco, Energy Fuels and Uranium-Energy for a position no more than 1000 $ and don’t look at the money. 😀
You might already know this…..
But there is a lawsuit against Cameco by CRA (Canadian Tax authority), which if successful will create a liability for Cameco approximately 1.5X its current market cap.
Thanks Duck. Very good that You brought this up so we all know better and won’t get hurt.
Yes, this stuff is ongoing. I guess some day they will sort out a compromise, just because CAMECO is so big. But it will definitely hurt. Well I am not into Uranium stocks because I know they may take years and years to take off.
But indeed fundamentals are compelling.
But also I am amazed at how low has U3O8 spot has gone. Hadn’t looked at it for 6 months.
I have a limit buy $CCJ at 5.50
JOLTS (Yellen’s favorite) were a total bust.
The only thing needed to push the US into a recession is a rate hike by the FED!
Just not gonna happen folks, not at least until May 2017.
I think you’re going to be correct, s29
*FED: SEVERAL OFFICIALS SAID DECISION TO WAIT WAS ‘CLOSE CALL’
*FED SAYS SEVERAL FOMC MEMBERS SAW RATE RISE ‘RELATIVELY SOON’
*FED: IT WAS NOTED ‘REASONABLE ARGUMENT’ COULD BE MADE TO HIKE
“Several participants expressed concern that continuing to delay an increase in the target range implied a further divergence from policy benchmarks based on the committee’s past behavior or risked eroding its credibility”
What about raising rates soon and let the US fall directly into a recession? What is the Fed going to do when the shit goes down because of THEM? Lower rates again and start another QE-round? I guess that’s good for their credibility! Do they want to be responsible for creating a recession? The Fed is totally cornered like Crooked Hillary!
Wow …. IBB.
Gary, are you still holding IBB?
We sold at the top. Now we are waiting for stocks to give us an ICL before taking anymore trades in the stock portfolio. We may not take another trade or the rest of the year in the stock portfolio.
The Fed releases their minutes from 3 weeks ago.
I wonder what cooked up garbage they just put in it this past week so it’s not really 3 weeks ago.
10 minutes to go so we’ll see how the markets react to this phony info.
It will be something from an “alternative universe”.
what a dumb market