Category Archives: Gold

“Risk-Off” – Overdone?

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Written by: Pauly @SPZ_Trader

Since last Friday’s bombshell announcement by FBI head Comey advising a further look into Hillary Clinton’s email issue the markets have been on a “Risk-Off” ride that has continued to gain momentum with nary a sign of slowing down.

How things change so quickly. Last week the dollar was riding high, and equities could not make up their mind whether to stand pat or rally into an expected Clinton victory.  I would argue at the time the dollar was way overdone to the upside and conversely the Euro extremely oversold due to new positioning. We all heard about Euro 105.   Gold was holding its own constantly flirting with the 200ma around 1265.

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Gold how low in the short term can we go?

Written By: Pauly Franco, Twitter: @spz_trader

With today’s release of FOMC minutes the market expects a “hawkish” tone among the notes. With those expectations the dollar is moving higher as the case for Central bank divergence begins to resonate.

Last week we saw Gold take a true beating as it has failed to spark upward price movement despite the advantages of Central Bank Quantitative Easing galore, Brexit, political unrest, and the list goes on & on.

So, we find ourselves wondering how low can it go after a $65 dump from 1313 area I pointed out last Tuesday ( mini tweetstorm) for the market to “go down like a submarine”.  Well, lets look at the 2-hour chart. We have what I believe is a range extension of the June to September prices which suggest at target of 1239 which coincides with 1239 “bias pivot”. An overshoot to 1230 is quite possible.  The market has been quiet for the last two days as it appears we have knocked some longer term bulls out of the ring.

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Why Technical Traders Need to Understand Fundamentals

  

Today we had a bearish technical look in both Yen and Gold. Does that mean that we immediately step in and short it? The answer is no. We watch the action and understand the theme of the day. We had a couple of themes to watch for in both of these markets. The first theme was that the Yen has been moving well in opposite correlation of the Dollar, so we watched the Dollar to see if it was holding our support (which would indicate possible weakness in the Yen).

Gold hit our top level of resistance at 1340 and had MACD divergence on the highs. Therefore we had multiple technical reasons to short Gold, but we wanted to see how the market responded on our short term charts for confirmation.

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Strength in Dollar Leads to Opportunity in Gold and Pound

This morning I discussed in our member area and on Twitter how the Dollar remained as my primary focus. We watch the markets that are moving with or against the Dollar and then evaluate which markets to trade based off of those reactions.

I Tweeted out and told our members that the Pound has now firmed up against the Dollar. Meaning that the Pound has stopped selling off on Dollar strength…the Pound was actually rallying with the Dollar this morning.

The Gold market did something similar yesterday when the Gold market failed to go lower with Dollar strength and then rallied with the Dollar.

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Gold Double Top on Daily – from Pauly @spztrader

Written by: Pauly @spz_trader

For the last two weeks I have been pointing out the possibility of a double top on the daily chart for Gold.  Gold has made two runs to 1378.  1380 is the 38% (1044/1924) fib level.

Gold’s last real chance to break higher was on #NFP day.  Most of the market felt the number would come in weaker after the previous stellar number, 287k.  Certainly, a weaker number would open the door for a delayed Fed.  Well, we get a solid 255 with upward revisions on back data.

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Correlations Lead to High Probabilities

This morning I posted on Twitter & talked to our traders in our member area about the Dollar being the key to watch for potential leadership in Gold, Euro, and Crude.  The Dollar was hitting resistance at 97.50 at the same time we were testing support in Crude (43.44) and Gold (1314).

Both Crude and Gold had gotten just below our big picture support, but our short term levels were still in reasonable distance to our bigger picture levels.  The fact that the Dollar was hitting resistance and we saw a reaction to the downside, that gave us an indication to look at long opportunities in both Crude and Gold.

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Morning Preparation Leads to Gold Short – Trade Setups 7.18.16

In this pic (left) you will see how Gold was hitting our 60 minute level. On the right 1-minute chart Gold got a new set of Beacon lines near the 60 minute level and Beacon alerted a short signal.

This morning in our member area I talked about focusing on Oil and Gold today over ES because that’s where I saw the opportunities.  I’m not just pulling those markets out of a hat, it all comes from morning preparation.  I scan about 5-10 markets to see if we are testing bigger picture levels.  I then work my way down to shorter term charts to see if the short term charts can help us execute a trade for that day.

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Identifying Where Traders Could Be Wrong in Gold – Trade Setups 6.10.16

I talked (and tweeted) about Gold no longer correlating against the Dollar, and the fact that Gold rallied with the Dollar indicated a possible unwind of the recent correlation. Typically when markets correlate against each other and then suddenly reverse and work together, that causes a strong move by the market that has stopped correlating.

In this case, the Dollar popped, Gold down ticked slightly, then Gold turned higher.  Right at that moment I knew to either be on the long train in Gold, or don’t look at selling rallies until the 1278-1280.60 area (as seen in my tweet below).

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Correlations in the Dollar Giving us Opportunity in Gold – Trade Setups 5.26.16

This morning we were once again focused on the Dollar to be the leader. Lately, we’ve been seeing our Beacon Indicator levels showing us the dollar moving in opposite directions against Gold and Euro. Today we had opportunities in both Gold and Euro to line up for shorts while the Dollar was at support. It is important for us to see these types of correlations line up for confirmation, because it solidifies our reasoning for a trade. The more confirmation we have, the more confidence we have in our execution.

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Long Gold, Short S&P – Trade Setup Mon.4.18.16

Our main focus today was the action in Gold vs. the E-mini S&P.  One of the keys when we look at correlations is whether or not we get technical confirmations on one market, does the other market confirm?  Today was a great example of how both markets received technical confirmations, and strategy alerts from our Beacon Indicator at the same time.

Gold got a buy signal and ES got a short signal.  This set off a trigger for us to take both trades.  If one of the markets would have received a trade signal without the other market, then we would still trade that market. However, when the other market gets confirmation and signal alerts at the same time, that just sweetens the look and allows us to size up.

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