155 thoughts on “WATCHING THE EURO

  1. zkotpen

    Pedestrian,

    “Next FOMC I will do the same.”

    Sure, you will look at your charts, and try to make your best attempt at figuring out the next move, in direction and magnitude, and determine if you will take action or not.

    I’m surprised you care about the presence or absence of gamblers, in determining what/whether to post.

    I know my forecasts have kept some people on this & the premium blog out of trouble — a few of them have thanked me over the years.

    It would be cool to discuss some meaningful trading & forecasting insights. I’m already satisfied with my abilities in the latter… though at times, it almost seems to be at odds with making progress in the former!

    1. Dday

      We are all gamblers, maybe some aree better than otheres. Don§t kid yourself if you see it as anything different. Changing the word to invesing, only makes one think its more justifiable.

    2. Pedestrian

      Sorry Zkot, can’t offer more than just an opinion here. Each to his own on trading. I was merely making a point since so many here seem to have such an objection to short term trading. The only idea I wanted to convey was that it sometimes makes sense to take a profit when it comes. There is nothing wrong with being mostly in cash until the right opportunity arrives either.

      I just noticed something yesterday about the Yen chart that is really bothering me too and I realized I am operating with potentially faulty information. So I don’t want anyone following along with me if I have a chart bias I was not previously aware of.

      It is such a big problem that I don’t want to say anymore that might cause people to come to wrong conclusions. You know I am neither bull nor bear and the only way I can trade metals is by keeping a sane distance from the barrage of hyperbole we read each day on the virtues of gold.

      Too many people come to gold with an agenda.whether it be philosophical in nature regarding the dollar and end of the world or it is because they have an interest in shares, a mine project and whatnot. Some people blog rather notoriously on gold with a hidden agenda as they are brokers, dealers or industry insiders.

      You have to be very careful reading between the lines of commentary you see and most especially when the writers are for the most part anonymous. I see this all the time with so-called analysts putting up abbreviated charts to make a point but leaving out critical elements that do not suit the point they are trying to convey.

      For example, they will offer an analysis of a one month period that appears very bullish but if you extend the chart back another week or more you will find instead another peak that entirely invalidates what they are saying. Such is the nature of people who attempt to manipulate our trades and mislead less experienced investors.

      So over the years I have gotten into the habit of challenging every bullish commentary and trying to take apart its premise see if there is a distortion or outright lie hidden within it. As a result I doubt almost all of them since the pro-gold bias is so overwhelmingly strong and the chirping about their rightness often annoying if not down right repugnant.

      That being said, the bulls may actually have a case here that I somehow overlooked and yesterday it cost me because my mind was fixated on a pattern that has actually been changing in front of my eyes without me even realizing it.

      Let me explain with the benefit of a chart to illuminate where I went wrong.

      I follow the Yen pretty closely. It is the first chart I look at each day. One of the things I do is check the channel on the daily to see if it is intact and there has not been a breakout or breakdown. OK, so far so good. That channel looks great top and bottom and there has been no breakout. There are two perfectly aligned rails exactly as I might have hoped for.

      But wait a second, those rails were also good yesterday and the week before and last month too.
      But the Yen has been trending up for most of 2017 and certainly there has been sideways action since the election.

      So how can that be? And here is where the error comes in. The chart technical is creeping along day by day and at every step it still gives a good result because you can ALWAYS find a point from which to draw the bottom channel to create two almost perfectly parallel lines implying a downward bias.

      And not only that but the pattern itself has gradually become a gigantic falling megaphone overtime implying a very bullish breakout to the upside is coming for Yen and by default for gold too. And that explains why miners have been making a stealth move upward even as the Yen and Gold charts seem to imply a downward bias to a pattern that just seems to never break lower.

      It won’t break lower is my conclusion today. Not when I expected it too anyway. So you see Zkot, I have been working with faulty chart conclusions and in fact the bulls may be correct about metals. They have turned bullish on the chart. And how that happened was because of “channel creep” and it was so gradual I completely missed it even though it happened right in front of my eyes.

      So what I need to do here is not talk about trades that are not going to be helpful but rather to reassess what the chart is actually doing and in this case I believe I should start deploying cash into miners and spend less time with ETF’s which in my opinion are only suitable in a falling or indecisive market.

      If we are back in a bull what I want are actual shares of mining companies. Not indexes, ETF’s or options.

      Hope that helps.

  2. zkotpen

    Looks like we are arriving at Don’s question from over the weekend (or Friday?), about 1220 as golden ceiling???

    IF IF IF — if it does hold (I believe it will for technical reasons, but that is NOT a certainty), gold may dive into a DCL, or it may just go for a “daily cycle triangle” or some other form of sideways consolidation, likely complex, such as a flat or combination of some confounding, frustrating form.

    The area I was looking at yesterday was 1183-89. That has migrated up a tad, 1185-90 area. If 1180 breaks — and the chart should give a hint as it approaches whether that is likely — then currently looking in the 1165-75 area for a DCL.

    But my idea remains from the past several weeks, though more solid since we looked at that 1220 resistance: The YC move up as a double zig zag, with the first zig zag now almost halfway complete. Each zig zag is one intermediate cycle rise, with some sort of intermediate degree X wave decline or consolidation in between: zig zag, flat, or triangle πŸ˜‰

  3. zkotpen

    Dday

    “We are all gamblers”

    Indeed — crossing the street, operating a motor vehicle, making decisions whose outcomes are absolutely and utterly UNCERTAIN. We do it all the time, every day of our uncertain lives.

    I don’t eat meat at my usual lunch spot, because it’s too much of a gamble whether it has been properly stored or not. I used to eat meat there sometimes, but one too many bouts with the ‘rrhea got me to be a local vegetarian! Odds are, from personal experience, maybe 90-95% that I could just order up a chicken dish, no problem. But that nasty 5-10% of the time… no way, not for me! One in every 10-20 meals with meat leads to the commode. That’s a risk not worth taking, when it is so conveniently averted.

    Some people hate math. I just happen to love it. Not the crunching. I hate crunching. Love the math itself.

    And even math-haters inevitably must love math. After all, without calculus, we humans would be in the throes of the food chain.

    Otherwise, Dday, do you have any insightful commentary to share, into trading strategies or setups that you are considering, and your thoughts on them?

    Now that would be interesting — perhaps even beneficial.

    1. Dday

      Zkotpen, I apologize my comment was maybe too harsh, and its not directed at you. Share trading can be very profitable, and I agree using technicals/ cycles…over time one can learn how and when to place trades. Just as playing poker professionally can be or going to the races, if you have skills and are experienced. It is gambling as you are effectively betting on moments in one direction or the other with no certainty, it is what it is…. Not to say there is anything wrong with gambling if you are able to make money…..

      1. Mac

        People can call it whatever they want, but most people on this site are not trading or investing but are simply gambling. Sorry but If you are making 150% over a period of a few weeks then you are taking on way too much risk. To put it into perspective if you annualize that number then your returns would far exceed Soros’ trade shorting the pound or PTJ shorting the market on Black Monday. All the power to you but it is only a question of when, and not if, you blow out your account. Just some more nonsense from me for anyone that cares to listen.

  4. Pedestrian

    So getting back on track Zkot, what I am looking for here is the Nikkei to rise and I still believe that will happen as there is a topping pattern in place leading up to where we see 20,000 approx on that exchange. In order for me to believe that gold still has a bearish downside I need to also believe that the Nikkei will rise a little further.

    The reason for this should be obvious. As Japanese equities rise (and by default most other major global indices also rise), the Yen is pushed down. And when the Yen falls then gold falls with it. So that is what I am monitoring. Essentially I am looking for stock market strength right now to imply gold still has a little more downside in its future.

    I had mentioned before that the 1125 gold level (roughly) looks like a magnetic bottom and if you use a daily or weekly chart you can see that most easily by drawing the lower channel line along the bottoms of the chart to where that imaginary future bottom lies.

    OK, now we get into an assumption here. Firstly, my belief is that gold has not yet made an acceptable bottom because it fell short of reaching its major support line going all the way back to 2001. That means by inference there is still another decline waiting to happen and at the minimum we should see gold hit support on a line drawn from the 2006 bottom to the 2016 low.

    We are not there yet and I continue to doubt the calls that we are in a new bull market. What I see instead is a dead cat bounce on a 16 year long chart so I am not surprised we did not take out the primary overhead resistance yet. Recall we got stopped at 1368 or some number like that.

    Over much shorter periods gold is gyrating up and down but the end result should be a test of the major support line. And that’s where the Nikkei comes in and Yen/USD strength. So if you look at Yen you can see it too needs to make an acceptable bottom at its 2015 support near .81 and there is clearly some work left to be done there. And this supports my view that gold can not yet have seen its bottom on this cycle.

    So where this gets interesting is that during 2017 the Yen has been tracing out a topping pattern as the Nikkei approached 20,000 and I think when it finally hits 20,000 it should reverse down and push gold up in the process. And that is where one of this years stock market corrections will come into play. I think the Nikkei top (as foretold by an impending gold bottom) is also warning that most major indices will also correct down for a period.

    We still won’t have final bottoms in for gold or Yen at that time nor even a final top for the Nikkei. This is only an interim pattern therefore. You really need to look at the charts for yourself and see where this thinking is coming from and what it portends (that the Nikkei has a massive rally in its future for example).

    So getting back to the point. I see the Nikkei rising to 20,000 in the next (month?) as yen and gold fall back before each has reached its respective interim top or bottom. If you look carefully at the pattern on the Nikkei during January and February this year it appears to be in the process of forming a minor megaphone topping pattern. Its next and most significant near term move should be up to 20k during which time metals will be pressured lower.

    When it hits gold will have bottomed and take off higher as stock markets correct. How deeply is anyone’s guess but I think its going to hurt.

    1. Pedestrian

      Correction:

      When it hits gold will have reached its FIRST bottom this year and will take off as stock markets correct. There is another deeper low for gold and thus a lower-low that comes in when Yen/USD reaches that .81 point.

      And that is the pattern I have been following this year.

    2. terrywg

      @Ped,

      No need to apologise for reading the charts inaccurately. As we had discussed earlier, the best approach was to “wait and see” how the price action in gold and miners developed. Nothing lost at the end of the day.

      What is your near-term view of gold? 1221 was my line in the sand to establish a bullish trend… but I would have liked to see a more impulsive move to clear resistance.

      1. Pedestrian

        I am seriously considering if gold does not go all the way to the 1325 area before this move is done. Since my original assessment of the pattern is completely in doubt right now I have to look at other scenarios.

        It really will depend on whether the Nikkei pattern of December-January makes a lower low that will add credence to the idea it is in the process of making a minor topping megaphone pattern. The final move up (which could already be in progress) will signal a short term decline in metals and once it reaches the terminus near 20,000 we will have our bottom in gold.

        At that point the megaphone will complete, the Nikkei will fall by several thousand points and gold will enjoy a tremendous rally for the duration. Hopefully you can see what I am referring too so it all makes sense.

        Anyway, this experience is a perfect example of why it does not pay to stake out a position as a bull or a bear. Once we do that we paint ourselves into a corner of our own making and are unable to admit a mistake to others nor take evasive action to get on the correct side of the trade.

        We really need to remain unchained of preconceived notions about what gold might do next and keep an open mind as the charts evolve from one day to the next.

      2. Pedestrian

        Terry, today you might want to look at the counter intuitive trade which would be a bounce back from yesterdays severe over-selling of gold bear ETF’s. Directionally may be up for the likes of JNUG for a little longer but this morning will probably open with JDUST making a move back up to correct its excess selling of yesterday.

        For example JDST sold off some 13% since the Yellen statement but I think it will recover all the way back to peak at 17.50 to 17.60 today. Nothing is ever certain of course but odds favour that over a crash to deeper lows if you check the chart.

      1. Pedestrian

        And often at the wrong time Terry. Don’t let the chest pounding and mocking deter you. Bugs are constantly trying to sow confusion and make it look like they are winners. Bill has been holding NUGT since the August top without selling so has taken more than an 80% draw-down at the low point which was just a squandered opportunity in my opinion. He is just dying for any scrap of news to prove he is right about the large direction. I cannot understand that kind of thinking. What was wrong with bailing out after the first 5% or 10% loss?

        Oh yeah. Its the Old Turkey syndrome.

  5. Goild

    Good morning,

    Indeed the rocket took off.
    This time I was not on board.
    The same mistake instead of focusing on the swing trade I was on the day trade,
    I take it many of us were left out.
    Good trading to all.

  6. zkotpen

    Hi Pedestrian!

    Thanks for your comments. I will have a look at these charts either Friday morning or a weekend morning, when my mind is freshest.

    A couple of questions do come to mind:

    1. Why Yen/USD, and not the usually traded pairing, “USD/JPY”?
    Just curious.

    2. Have you looked at GBP/JPY?
    Since you mention your interest in the Yen — as you have in the past. Just yesterday, I took a look at GBP/JPY for the first time. A lot of currency pairs look funky, all over the place, random, etc., on the charts. But yesterday the yen was down & pound up so I thought I’d give it a look. Haven’t had time to study it yet, but at first glance, that is a rather neat & tidy looking chart.

    I am trying to move over to more favorable time frames, like markets that trade 24hs per day — Currency markets seem like the solution, as soon as I am able to make that work as a practical matter.

    I am also concerned about the seeming almost adversity between trading, which is psychology; and forecasting, which is my own field of economics. After all, if you can identify coin flip setups before a market move occurs (your charts tell you there’s going to be a market move, but you don’t know which direction), and your calculated reward:risk ratio is 3:1 or greater — why bother with forecasting at all? Just trade as many of your setups as you can, win half of the time, lose half — CONSISTENTLY — and you will cash in & grow your equity over time.

    But it is a dream of mine to make market forecasting a science, not just to improve the odds for trading financial markets, but to help people in general better understand the movements of ALL types of markets.

    I never liked the zero sum game notion of an economy or market or transaction. Likewise for that other insidious analogy they used to teach in so many Econ classes: The prisoner’s dilemma.

    Ideally, I’d just kick back in the lab, experiment, analyze data, draw conclusions regarding the hypothesis, revise & tweak as necessary, compile the whole story, then pass it off to the publisher & either enjoy some reward if both merited & timely, or simply die, and let posterity judge it on more objective terms than might be possible while one is still alive.

    As I study the psychology of trading, I turn my attention to things like, for example, an oversight that one fails to see in a chart as a sort of defense mechanism that must be overcome, and other harmful behavioral patterns, and consequently the need to develop guidelines and parameters to move beyond those self-imposed, often self-sabotaging limitations, I wonder if it’s taking me away from my research, or indirectly helping me get there, by going the long way.

    As a wanderer, I’m pretty much OK with going the long way, the slow way.

    The only thing I do fast is walk πŸ™‚

    1. Pedestrian

      I use Yen/USD because it looks shockingly similar to the gold chart when viewed as a daily. Here, have a look for yourself and you will appreciate how this makes life a lot easier when monitoring the gold charts as both will move in the same direction. So you don’t need to twist your head around trying to think in inverse patterns. Basically it just saves time when you need a quick decision.

  7. zkotpen

    Actually, I was thinking of shorting GDX before yesterday’s close, but 2 things influenced my decision not to:

    1. Gold was clearly going up today. Would it exceed 1220? I didn’t know, but I knew 1220 was the proving grounds. I figured I’d watch & see how that turned out.

    2. That bizarre spike in GDX at 3:07 p.m. market time. It spiked up more than 4%, right to one sixth of a penny of its 200 day SMA, then went back down to is previously scheduled program. I don’t know what that was, but there’s no way I’m just going to discard it, as most people seem to have done.

    Based on those two factors, I decided to sit out the overnight trade. And as posted yesterday, I didn’t bother with the Wednesday trade, as the market was moving way too sideways for my taste or skills…

    1. Pedestrian

      To answer your second question above I have just one simple observation and point. That is to NEVER trade anything until you are completely familiarized with the currency charts. They impact directly on everything and if you use futures you have the advantage of being just a little ahead of the crowd at turns as what happens in the futures market shows up later in gold and silver and oil or whatever it is you trade.

      Use this one. It is the best I have found and its free to use. Just click on any item to see the chart levels.
      http://finviz.com/futures_charts.ashx?p=d1&t=6J

      1. dboz

        This is just not true. You were calling for USD to run to 120 or some big number. So following the currency charts has cost you to miss out on a monster move. In fact, you were actually shorting silver at the time it exploded up by 1 dollar. You need to focus on sentiment some more. Quit trying to prove you are right by calling for lower prices for weeks. You are sounding like Alex. Keep making the call, one week gold will go down and you will be right. Appreciate your help and insight, but you have been terribly wrong. Keep posting though, I like the differing opinions.

        1. Pedestrian

          Not at all Boz. Don’t forget your time frames. I am saying the US dollar will EXCEED 1.20 by 2018. I never said 2017. Keep in mind long term versus short term charts.

          1. dboz

            OK, still appreciate your posts! Yes, you have told me multiple times our timing is different and I understand.

        2. terrywg

          @dboz

          you are the definition of a douchebag. I’ve been here every day for the past month and have noted all of Peds calls. HE MADE 10 FRICKING PROFITABLE TRADES IN A ROW. And unlike some of you, he posts his trades in real time, WITH ANALYSIS. How many of you actually do that?

          if you want the comments to be filled entirely with gold bugs, then please let us know and we will leave. You guys can continue to live in your own echo chamber.

        3. terrywg

          the fact is that the bugs here are the ones who have been calling for higher prices for MONTHS. Ped, zkotpen and a couple of others here have no bias towards either direction. We are happy whether it goes up or down, because we trade the movement in price and not the direction. I hope this is clear to you.

          Have a little humility. We are more than happy to have civil discourse- that is what makes the market. But the fact is that some of you just seem to forget your errors once you see a little green in your account.

          dboz, how about you scroll through the last 2 weeks of posts and look at the many predictions that ped made: they were spot on. Alex had a success rate of 1 in 10… this is the inverse. Your comparison is frankly demeaning.

          1. terrywg

            correction: i meant “converse” instead of “inverse” (zkotpen this one’s for you because I know you’ve studied mathematical logic.)

          2. dboz

            Just scroll through and look at mine. But yeah, I am not a day trader so you may be right if you guys are in and out. I really don’t break it down like that. Just overall trend and perspective. It’s all good. Just saying, a couple of you guys are perma bears and just as annoying as gold bugs are to you.

  8. Gary Post author

    Folks you can listen to the day traders and try to follow them as they jump in and out and recalculate their charts every 5 minutes… and make virtually nothing.

    Or…
    You can just pay attention to the videos and charts I’ve been posting. We’ve taken the leveraged metal portfolio from +50% to +150% in 5 weeks.

    I think we all know none of the day traders are even vaguely close to those kind of returns.

    Better still get a subscription and I’ll teach you how to follow cycles & sentiment so you can spot these turning points yourself and hopefully you won’t blow this opportunity like so many are already doing.

    This will probably be the largest bull market that any of us will ever see.

    Remember the bigger the bear market the bigger the bull market will be that follows. The bear market in miners was one of the most destructive in history. It’s going to generate one of, if not the largest bull market in history.

    Seriously, does anyone really think that printing trillions upon trillions of currency units isn’t going to ultimately have consequences?

    1. Dday

      If have held your position for five weeks, i’m curious how you have calculated 150%, NUGT was $7.11 five weeks ago, now around $11.00. Or have you been jumping in and out of trades?

      1. Gary Post author

        Original purchase:
        JNUG $6.00
        NUGT $7.95

        I also got lucky and traded the wiggle into the half cycle low perfectly.
        exited:
        JNUG $11.14
        NUGT $8.94

        Then reentered;
        NUGT $8.00
        JNUG $9.79

        1. Dday

          Will have to take your word, which goes for everyone on here. I’ve said lower down, trading ideas i like, whereas perfect trades announced after a period i’m more skeptical. I bought nugt 6.79 sold 11.3, bought dust sold at around 9.7 and repurchased nugt. I guess i was also lucky!!

          1. dboz

            Just going to say, Gary says become a subscriber if you want to know his real time calls. Why would he post them for free when others are paying him for his knowledge and skill?? Just keeping it real.

            I find the info he provides to be very beneficial regardless of his real time trades.

        2. Epiphany

          why are you trading in and out so much Gary? Don’t you have any vision at all? Hold for 3 to 5 years and watch as JNUG goes to $500 and then $1000. You retail traders are all alike and will never make any real money.

        3. Epiphany

          dude….you didn’t exit JNUG at $11.14. It hasn’t even seen anything above $10 since early Nov 2016. Go back to your crack pipe and give these poor saps their money back.

    1. Pedestrian

      Not to make you crazy but gold projects down to at least 1150 from here. And that is a direct result of golds move this morning exceeding the January 23rd high. We will see. In retrospect I may have been right all along but every day brings its challenges and a new review of the charts. It’s why I say it does not pay to take long positions in a bear market.

      1. Robert

        Gary has said we will get a daily cycle low soon but 1150? That seems a stretch ped. What if gold hits 1250 by tomorrow? I think 1180 max. Gary you sure about a daily cycle low coming?

        1. Pedestrian

          Well Robert, this is Gary’s site and I don’t make it my business to argue wit his trades. Especially as we are really on different time frames. He could be right. I have a different outlook but as you saw yesterday I hit the occasional concrete highway barrier during my daily driving!

        2. Gary Post author

          Pretty sure. The dollar has a date with a daily cycle low soon and a short term bounce. Gold could churn sideways during a dollar rally, but I doubt it’s going to make much headway during one. It’s more likely gold will cool off as the dollar rallies and reset the bullish sentiment.

          Like I said most retail traders will buy this breakout today, then they will sell during the pullback into the daily cycle low. Buy high, sell low. Lose money during an advancing market.

          1. Epiphany

            this is going to be hilarious Gary as you scold everyone for not being out of the 3X miners like you are only to watch much higher prices get inked 8 days from now. I don’t buy break outs either, I buy support and have been long JNUG since Dec in $3.90s….a way better entry than you.

          1. terrywg

            hey ped, just looked at my favorite charts – EURUSD and USDJPY (i’m a currency trader).

            Based on the price action in these two, I think gold is bullish ST.

            Let me explain: for the past couple of weeks, USDJPY has been trading within a corrective price action structure of 112.70- 115.30. It just broke out of the structure today in asian markets. If it closes another day or 2 below this then it is very bearish for USD.

            Secondly, EURUSD is not going to face any near-term resistance until 1.0860. Meaning that it still has some ways to go.

            If both the yen and the euro show ST bullishness then this of course means that the USD has to go down. Based on my forecast of USD ST bearishness, and also the fact that gold broke my target at 1221, I am buying 600oz of gold futures at 1220.33. Looking at a target of 1240 and perhaps 1260 in extension. Stops set at 1215.

    1. Pedestrian

      Based on what Goild?

      You keep making similar comments but never back them up with anything at all. You make money on bull trades when gold is going down. Mind if I call your bluff here since your NUGT bets are improbable based on the times and days you say you got them.

      1. Dday

        If it closes above $1220 then I agree with Goild should climb tomorrow $1229, $1246. But hey its all speculation, and maybes… If it falls at US open and closes below $1220 then down it “could” go….

  9. Goild

    Ped,

    There is no question that metals are bullish. Gold just passed $1220.
    USD has no support in near sight. It is falling.
    Gold is bulling right now.
    The small retracement was swiftly recovered.
    As Livermore, I back my opinion with money. I just got 4K shares at $11.72.
    I am not here to bluff. My time and everybody’s time here is very valuable to waste it.
    We are here to make money. Since the bottom in December I have made +$80K and well surpassing the $150% mark of Gary’s portfolio. I sincerely hope you are doing very well Pedestrian.

  10. Dday

    Agreed with Ped its pointless throwing numbers about “i made this since… etc”, who can verify. But sharing trading ideas thoughts of future movements is great……

    1. Gary Post author

      Well unlike the rest of you my trades are placed in real time, recorded, and can be verified by any of my subscribers.

      Of course it makes me an easy target for the trolls who crucify me any time a trade doesn’t work within 5 minutes of my call.

      I’m not a day trader, I try to trade the intermediate trends. I like to buy at bottoms and sell at tops. Sometimes I’m in early, and sometimes I also exit early.

      No one can time perfect entries and exits consistently…except the trolls and with a heavy dose of Monday morning quarterbacking. πŸ™‚

      1. Dday

        Questioning trades posted on this forum isn’t trolling. I’m simply pointing out that anybody can post any trade on here without backing it up. Good for you if you have done well, I wasn’t having a go. I did alright as well. I don’t have any subscribers, so when things go wrong I don’t mind saying so, nothing to loose. Ped posted trades real time he has done ok as well…. Hey there is more than one good trader on here, great!!. More technical opinions the better…

  11. zkotpen

    Dday,

    “It is gambling as you are effectively betting on moments in one direction or the other with no certainty, it is what it is…. Not to say there is anything wrong with gambling if you are able to make money…..”

    Sorry Dday, but I’m gonna have to differ with you on this. Look at terrywg’s word I pointed out. I believe Pedestrian has used the same word. I might have missed it a month or two ago, but lately, it has been brought to my attention in my reading. I will bring it to yours, and I hope it proves most PROFITABLE 4 U:

    CONSISTENTLY

    If you can make your profits using a disciplined approach, and do so consistently, you can even trade coin flips profitably. But you must be able to do so CONSISTENTLY.

    Note: “Using a disciplined approach” means
    (1) establishing your trading criteria — let’s say just a coin flip, or if you have something better — Gary’s calls, your own TA, granny’s funny feeling behind her left knee, whatever;
    (2) calculating profit targets & risk (amount you accept losing before stopping out of a losing trade);
    (3) ensuring risk:reward is greater than or equal to 3:1; and
    (4) entering all trades that meet your criteria, and exiting according to your criteria, regardless of whether the trade is a winner or a loser.

    If you do that, then you become the casino, not the gambler πŸ™‚

  12. zkotpen

    Pedestrian,

    Thanks for the chart. Go figure — I’ve got the finviz “Currencies” page with all of them on one page, and I click on a chart if interested. I use tradingview for more detailed looks.

    Yeah, I agree about becoming familiar with a chart — you should be able to dance to it (while listening to Barbarito Torres or Tito Puente, for instance πŸ™‚ )

    When looking to add to my charts, I ask myself if I can recognize patterns — if yes, then I begin to look more closely. GBPJPY is something I want to look at a bit more closely…

    PS: Just got back from my favorite value juice bar: Mango – apple – carrot – papaya — simple things I so love in life πŸ™‚

  13. Option Trader

    Obviously this was a late night for some traders here, getting caught on the wrong side of the fence, with long posts and losing sleep. Interesting how some of them are attacking posters on the board, probably frustrated about their own loss. I think these people should stop bullying others.

    I’m glad I encouraged at least a few to get on board, a few days back.

    1. Pedestrian

      I never lost a wink. Actually I feel terrific today. The long post was for Zkot and could not be boiled down to a pithy tweet and still make sense so that ‘s how it goes. Don’t feel obliged to read any of it if you are busy. Its all water off a ducks back.

    1. bill

      House why would you short into this strength? The winds of change are in the air, why some feel the same old same old will continue is beyond me. But hey to each his own.

  14. dboz

    I think it’s possible that we may have seen the bottom and that is why no one knows where we are going. Waiting for a pullback that may not happen. Dollar to 95, silver 18.90’s, gold 1250-70.

  15. Gary Post author

    This is definitely not the time to be chasing with leverage. The dollar is too deep in its daily cycle. A bottom could occur tomorrow on the jobs number and trigger a 5-8 day bounce. Unless you think gold will rally along with the dollar it’s best to stay unleveraged for now until the dollar bounce runs its course and starts the next leg down.

    Gold might churn sideways during a dollar rally but I doubt it will deliver a strong rally during a dollar bounce.

  16. dboz

    Understood. I just think back when the dollar rose for 7 weeks and gold dropped for 7 weeks with minimal bounce. Could a rebound back up take the mirror path. Just my thought. Could be totally wrong. Again, pendulum thinking.

  17. Option Trader

    I’m happy to remain long here with my option calls and will buy with two hands and feet if I’m lucky enough to come across any decent pullbacks.

  18. Gary Post author

    The currencies are influenced to a big degree by the stock market, and the PPT has done an incredible job of preventing the coil from reversing back down. They have again blocked the market from developing any real downside momentum.

    And again the shorts are finding out why I keep repeating not to short the stock market. Many just keep sticking their fingers into the fire though. Folks it’s almost impossible to win in a rigged market. The Fed has a printing press. They can stop almost any sell off fairly quickly.

    We need a dislocation in the bond market before the interventions in stocks stop working.

  19. Strike

    My opinions follow. All are outcomes of my chart interpretations. I use Stockcharts because I think it offers max flexibility and ease of use. I am not a cycle follower but I respect Gary’s and Surf’s work as complimentary to my charts. Since I am generally not a short term trader I focus on dailies and weeklies.
    1) Dollar charts are ugly. Weekly has ominous MACD cross. Daily stochastics look like $USD was shot dead and the corpse has been lying on the ground for weeks. Out of these setups usually come at least a dead cat bounce (sorry Ped – I know you like cats), so I tend to agree with Gary’s and Surf’s short term calls for a dollar bounce.
    2) Maybe I am rooting here but $Gold and GDX charts look very promising to me. For example, the MACD and slo sto look eerily similar to last year. Not enough of guaranty, but a good start. I plan on adding more long leverage upon the much anticipated dollar bounce. With my luck it won’t give me the opportunity and go straight up from here. But I won’t chase.
    3) Fundamentals always eventually rule. Our current President would love for the dollar to fall drastically for reasons that are irrelevant. What he wants is what he’ll get at least at the beginning of his term. Good for gold.

    1. Strike

      Clarification – I mean his reasons are irrelevant to the outcome – the dollar will go down whether his reasons are justified or not if he’s pushing for it. I’m not making a judgment as to whether he should favor a weaker dollar or not. But it will happen.

    2. Pedestrian

      If the President calls for a weaker dollar again I suggest buying the dip that gets created. All such comments are designed to move markets into a sweet spot for insiders. As soon as I heard the President say he wanted a weak dollar I took that as a signal to look for the best entry possible and get ready to trade to the upside.

    1. Epiphany

      Gary couldn’t have been more clear on your question when he wrote above: “This is definitely not the time to be chasing with leverage. The dollar is too deep in its daily cycle. A bottom could occur tomorrow on the jobs number and trigger a 5-8 day bounce. Unless you think gold will rally along with the dollar it’s best to stay unleveraged for now until the dollar bounce runs its course and starts the next leg down.”

      So according to Gary you should stay unleveraged and not be in 3X miners now. What’s hilarious is that if prices just head higher from here over the next 8-10 days (which Gary says it wont as prices go into a cycle low) he will still take credit in his fictitious portfolio for any pretend gains he would have realized had he stayed invested in 3X miners. See how this game works???

      1. rozelina17

        Yes I saw that Epiphany BUT I start losing my faith and respect towards him. He was the one who said to everyone to buy JNUG at the price of 32$ some months ago…since then the price of JNUG dropped to less than 4$. We are talking about a huge loss! And now he brags about 150% or so gains…at least be a man and admit that you made a wrong call instead of doubting people’s intelligence.

  20. Strike

    Well, that is a classic contrarian view Ped, but where does it stop? Is there anything an elected official can say that shouldn’t be faded? Do they EVER say what they mean?
    What possible reason would Trump want the dollar to continue stronger? Is everything to him and all Repubs and Dems a short term trade? Does anyone ever say what they mean?
    I respect your opinion but I think fading everything someone says is overly cynical.

    1. Pedestrian

      No problem. We will learn to read Donald bit by bit just as we learned to read the comments of the Federal Reserve Presidents and European Central Bankers. Maybe my view is a little cynical but words from the top often represent the agendas of money interests so its good to pay attention. I kind of like that he tweets. It will make trading interesting.

  21. Pedestrian

    Looks to me like NUGT has topped out. It didn’t really get that far anyway. Gold shorts are appealing right now while we are still hovering at this level. I sure as hell would not get long here. But that’s just me.

  22. Robert

    Pedestrian NuGT indeed looks topped as Gary has said any day now. But dont you notice that gold goes down more than GDX? It was like that last time gold pulled back also

    1. Pedestrian

      I do notice Robert. And I think a few others have too. The set up is very bullish once we get this decline out of the way. I feel positive about golds prospects say a month out or that range. You could probably hold through this decline if you were in shares and wake up in summer and never have noticed that there was even a problem.

      Not investment advice though. I don’t offer any.

  23. dboz

    Volume collapsed also this afternoon after a huge start the first hour. Move up on big volume this AM, minimal to no move down on low volume this PM when gold and silver dropped. Seems very bullish behavior to me. Buyers and conviction are strong. No reason to sell if long right here in my opinion. Not worth timing the re-entry. Time will tell if the drop becomes more sustained.

      1. Option Trader

        I agree Dboz. Miners are showing nice strength here and I like to see them leading the metals. Silver is underperforming Gold here, so that may indicate the metals are digesting their recent moves and need more time to do so..

  24. terrywg

    @Ped

    if USDJPY closes above 112.70 (therefore a reversion to the corrective price action structure it has been trading in for the last month), and Euro above 1.08 at end of day, then I think our previous forecast for 1150-1160 gold becomes a lot more certain.

    bought gold futures at 1220, got stopped out at 1215. That’s what I get for jumping the gun and not waiting for the impulsive move off 1221 I was expecting to confirm the trend. Pretty frustrating as I have been sitting on my hands the entire month just itching to place a trade.

    1. Pedestrian

      Yeah, I would be looking for a left translated double top on the USD/Yen around 1.16 or so (without getting too scientific about it quite yet). The decline that follows is going to be the breakout in gold and the next stock market correction rolled into one. We will want to be ready because I suspect its going to be a GREAT trade.

      Sorry to hear you got stopped out though. It happens. I am back in the drivers seat today and drinking my own Kool-Aid after having slept off yesterdays rout that rained on my parade. I was only one day early in my assessment. Still looking for that Yen/USD decline I predicted yesterday and I think I will get it.

      1. Pedestrian

        By the way Terry, did you read that post I left about the Yen and a Stock market correction? Do you agree in principle and did it make sense the way I explained? Just curious since nobody answered me and that left me wondering if I was out to lunch!

        1. terrywg

          @ped

          sorry, thought you were talking to zkot.

          i think your macro view and observations about the global flow of funds are largely accurate. The reason why the yen and gold correlate so well is that they are both risk-off assets priced in USD. I have observed that SM corrections are always foreshadowed in USDJPY, as the big players unwind their carry trades and pile back into the Yen.

          If the Nikkei is buffeted and corrects heavily at the 20,000 level then it shows that the flow of funds has largely shifted out of global equities.This means we will also see a concomitant rise in gold and yen.

          Now, whether or not the Nikkei tests 20,000 again is up for discussion. I will probably need to study the charts over the weekend as I have admittedly been neglecting that index. The main reason for my call for 116x gold is because of the EW setup in gold and also my analysis of the price action in the yen and euro, and not based off observations of the Nikkei or the stock market. The yen has been respecting support at 112.70, while the euro has been kept well below 1.09 resistance level. This, coupled with the fact that the USD due for a bounce, signalled to me of future ST strength in the USD and weakness in gold.

          The question that now remains is how strong this bounce in the dollar will be. If it is anything close to my original forecast then we will see 1160 in gold at least. After that I agree with you that we should see several weeks of a rally in gold.

          Also, correction to my previous post: if we see USDJPY close above 112.70 and EUR BELOW (not above) 1.08 today then we can be a lot more sure of our ST outlook.

        2. terrywg

          Also, how do you intend to trade this market? I am thinking of just waiting for a meaningful correction before scaling into my gold positions. Imo, shorting at this point is still a little bit of a risky trade.

          1. Pedestrian

            Shoring it Terry. It’s my specialty. Probably how I got the nameplate of a bear fastened to my forehead but if has been well worth the time for the past few years. I am all bull once we turn around though.

            Terrific analysis by the way. That was a great read.

      2. Pedestrian

        PS: If I get this one right and I am able to accurately predict the next market correction (a feat tried by many and achieved by only a few) then I will be bulletproof and nobody gets to criticize me here anymore!!! LOL!!!!!

  25. Option Trader

    GLD and SLV providing no serious bearish set ups on my hourly charts. Only one hour to go before close.
    In fact, all we’re seeing at this point is consolidation at recent break out, resistance points.

    We’ll have to see how the last hour closes. But if the metals continue to hold at these current levels, the bears may not get the nice pullback that they’re looking for.

      1. Option Trader

        I agree Mega. I think we all agree that the metals are at over bought levels here. A pullback is due in normal market conditions. But we have to get used to extreme overbought conditions in a bull market. If we don’t get a sharp pullback in the near future, how can we second guess the bullish momentum behind this recent move….

  26. MegaMind

    I think the miner correction will happen in March… I think euro is getting ready to be dumped before the French elections in april so the drop could happen in march… so expect miners to rally

  27. MegaMind

    here are some targets that I calculated based on half way pattern… NUGT 18
    jnug at 16.50
    Jdst 6.50…

    any one care to calculate these … I may be jumping the gun… I do that sometimes… sometimes I shoot myself in the foot too…

  28. Steffmeister

    Dollar down, stockmarket down and precious metals up, I like this analysis by Christopher Aaron. It is in line with my open interest trigger event coming soon.

    https://youtu.be/1upFyb3GmmQ

    The Bond market has topped, stockmarket is about to top within a month or 2 … then Gold will get a serious bet imo.

      1. WallStreetJesus

        Ped – Haha I looked at the chart couldn’t find any illusive Elliot waves.

        All I know about Elliot waves is no two people can agree on the count.

        Charts are like prisoners of war – if you beat them enough they will tell you anything.

    1. WallStreetJesus

      Don – Your timing lately has been exceptional.

      Todays action seemed a bit bearish to me.

      I was thinking we might get a pullback.

      Haha time to roll the dice!!

  29. Option Trader

    I am very happy with the way the metals performed in the second half of the day today.
    Firstly, the miners killed it all day during the consolidation going on
    Both GLD and SLV had decreasing bearish volume all day.
    SLV changed from bearish volume to bullish volume into the close.

    Not bad at all..

  30. dboz

    One more big push up in silver to clear the 17.50-60 level for good and nothing is holding it back from high 18’s. It could get there pretty quickly. We will see if the dollar holds or fails, 98 is coming soon. Possibly the jobs numbers tomorrow will give us a boost or a plunge. I say its a boost.

  31. Option Trader

    The close of the first hour tomorrow morning, is very important. If we continue the bullish turn around from today’s last hour…. than bulls are in charge. If the first hour closes in the red, than we have more consolidation ahead…

  32. zkotpen

    Pedestrian, terrywg,

    I will have a look at Ped’s long post RE Yen & stock markets over the weekend. I am focused on GDX & gold until the week closes.

    terry’s comment gives some additional thoughts for consideration, which will make the exploration even more interesting.

    1. Pedestrian

      For what its worth, Zkot, I am not really saying anything that most people here don’t already agree with. I am bullish gold after the next pullback. Where I have differed is I am attempting to connect the gold bottom with what I believe will yield the next stock market correction.

      The logic follows thus:

      If Japanese stock (Nikkei is the proxy) declines result in Yen rises and that pushes up gold then it just stands to reason that the only way we are going to get a move up in gold at this time is if we also see a reciprocal decline in major stock markets. And do keep in mind that US, European and Japanese markets generally move in lockstep, rising and falling together.

      That is how the existing correlations work and until now they are still intact.

      I just cannot come to any other conclusions given the key correlations and the behavior of the Yen, long bonds, Nikkei and gold. To my eye it is gold itself that warns we have some kind of market disturbance coming but how significant it will cannot easily be judged.

      The other notable factors at play are a VIX that has recently fallen to record lows, treasury market charts that are sitting at the lower boundary of their respective channels and stock markets themselves which have been struggling to stay aloft at nosebleed levels.

      Now a mention of the bonds / stock relationship is in order. One thing that we have seen recurring in the past is that as global stock markets dive that bond prices rise and yields fall. Secondly, we typically see a corresponding move into the reserve currencies which are still Dollars, Sterling and Swissy as flight to safety ensues.

      Well by coincidence the dollar has sold off since middle December and is now due to bounce whereas the Swissy/USD and Yen/USD are following golds pattern. That is to say that when those second two currencies bottom (at the same time gold bottoms) that we should see a stock market correction unfold with Francs, Dollars and Yen/USD all rising together with gold and long bonds as global equities take a breather.

      I have been back and forth many dozens of charts and examined this every which way to Wednesday. While I key in on the Yen because it is most convenient there are in fact a variety of other charts and tools I use to draw my conclusions. So I don’t say any of this lightly.

      I am warning that a stock market correction is possibly imminent and should arrive during the month of February as that is the closest I can time it. And I am saying that once gold completes its next decline that a significant rise is in store given the implications of the megaphone pattern that has developed since last August (gold daily chart).

      Doubters can ignore the signs at their peril. But I will tell you this: If you believe gold is about to embark on a run higher then by default you already believe stock markets are going to see a haircut. And it is because that is what the correlations are already telling us will happen.

      We just need to pay attention.

  33. zkotpen

    Pedestrian,

    I see the first 5 waves down on that hourly silver chart you posted. Thanks for sharing, as I do not normally look at silver. Also, the way the move up finished looks like an ending diagonal maybe — again, as with the currencies, if patterns start to jump out at me, I look more closely. Silver’s patterns are less clear to my eye than gold’s.

    1. Pedestrian

      I like to say all charts are a Rorach test. Some people read them and see snakes in the grass and other guys see elephants with naked women in top hats. What is most amazing though is how two otherwise normal people can look at the exact same chart and one guys calls “Bear Market” and the other roars back “Bull”!!!!!

      Charts can and do trick the eye though. It happens to me all the time although not as much as when I began. There are patterns that pop up so frequently and with enough reliability that you don’t need to think very hard at all.

      But other times there are patterns that can stump you for days as they develop and need plenty of supporting charts and technicals are needed before you can feel confident you are getting the right information. As much as possible I avoid allowing myself to let my ideas influence what I am seeing but that’s sure a lot easier said than done.

      So about those Elliots? Well, its subjective and we all agree Elliot is not easy to read except after the fact. Sometimes you just need to squint your eyes when looking at a pattern and it makes better sense if you blur out the detail. (no, I am not kidding!).

      Anyway, now it is the next day and I am looking at that same hourly chart again as silver has fallen another ten cents since yesterday late afternoon and I am no less convinced now than I was yesterday its a five wave Elliot that peaked and is in decline.

      I guess the proof is on the end results. If that price chart bounces back up to say 17.30 today it becomes a lot more convincing and bulls had better be careful because it suggests Mondays open will bring a third leg down EW decline.

  34. zkotpen

    terrywg,

    Dang! Wish I could’ve helped keep you out of that long gold trade, though I’m sure it figures into your overall performance as “cost of doing business”.

    But yeah, the move up in gold gave divergences, suggesting it was a fifth wave up & ready for reversal.

  35. Pedestrian

    So what I am watching for today is to see if the Nikkei falls below its January 18th low and then bounces.

    We don’t need to see more than a few points lower either as that will suffice. What we should expect then is the Nikkei to make its way up to (and exceed) the January 26th peak at 19,600 although how quickly that unfolds is harder to know. Should any of this come to pass we will indeed have a top megaphone pattern in play and should then expect a stock market decline to begin as the pattern completes.

    Obviously there is some conjecture here but so far we have a good set up and a reliable indicator forming to watch. Should it come to fruition we had best be on our toes. Nobody knows the future of course and I don’t know it either. I am merely looking at what I think is the highest probability given the charts set ups.

    You are all welcome to call me crazy afterwards. I think I can take the heat.

  36. Pedestrian

    OK, now lets get specific. If I am going to make a forecast it should be something that you guys can hold me too. As mentioned already I expect the Nikkei to move up near 20,000 while gold falls to 1150 and silver to 16 dollars. Swissy should decline to .98, Yen to .85 and change while the 30 year finally hits bottom at 148.00

    That”s my call. What happens next will wake up the markets and send VIX soaring.

    1. WallStreetJesus

      I think that might be a little too bearish on gold and silver. I think there is a lot of people on the sidelines waiting to buy. Long term Trump is going to be good for the metals. Possibly an environment where both gold and the dollar do well.

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