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  • #141
  • Oct 11, 2013 7:37pm Oct 11, 2013 7:37pm
Quoting theDHT
{quote} Gold: Follow Up Say No To Temptation (until the break is qualified!) Daily {image} original post: http://www.forexfactory.com/showthre...75#post7017275

Hi guys,

Great job here. It is difficult for me to keep up with everything, so here is my small contribution on gold. I have good potential area for bounce and similar first target as DHT based on pattern. Further, ultimate target of pattern is potentially 1026 if it plays out.

Good trading,
Scott
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The world you desire can be won. It exists.. it is real.. it is possible..
  • #142
  • Oct 11, 2013 8:04pm Oct 11, 2013 8:04pm
Quoting venzen
about the AUD... this awaits confirmation, but the evidence is overwhelming: {image}
i agree, cant wait for the short train to start again. i think the big shorts will come in January 2014
Be hopeful in a winning position, and fearful in a losing position.
  • #143
  • Oct 11, 2013 8:10pm Oct 11, 2013 8:10pm
Quoting Rag2RichesFX
{quote} i agree, cant wait for the short train to start again. i think the big shorts will come in January 2014
I can't wait that long, I have 96 as good place if it gets that high. Why Jan 2014?
The world you desire can be won. It exists.. it is real.. it is possible..
  • #144
  • Oct 11, 2013 8:26pm Oct 11, 2013 8:26pm
Quoting Rag2RichesFX
{quote} Look at the two monthly candles. That will take some consolidation to break through. It won't just head straight down, you know? I mean even if October closes as a Doji, it might not head straight back down in November. It might do so in December to make the yearly candle look nasty. Plus major trends dont tend to continue into year end. They continue after the new yearly candle has opened
Fair enough, sound reasoning, thank you for the response.
The world you desire can be won. It exists.. it is real.. it is possible..
  • #145
  • Oct 11, 2013 9:48pm Oct 11, 2013 9:48pm
Quoting Mr. Scott
{quote} Fair enough, sound reasoning, thank you for the response.
lol i just re read what i said

i contradicted myself


basically, by "big short" i meant a short to 8500 or lower

that probably will play out next year. rest of 2014 i think we stay above 9300
Be hopeful in a winning position, and fearful in a losing position.
  • #146
  • Edited 10:42pm Oct 11, 2013 9:59pm | Edited 10:42pm
Quoting theDHT
{quote} Silver ...like clockwork... Daily {image}
I'm going to smash $17.50 with longs (tight stops, 1;50 risk reward long term)

Its impossible for a break of the lows (18.24?) to happen WITHOUT creating a MONTHLY divergence.

Last time EURO saw a monthly bullish divergence was July 2012, and we all know what happened since then.


https://www.tradingview.com/v/GBaC6Wga/
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Be hopeful in a winning position, and fearful in a losing position.
  • #147
  • Oct 12, 2013 2:02am Oct 12, 2013 2:02am
Quoting PipTrapper
{quote} Under normal circumstances, your reasoning is highly logical and stands an excellent chance of playing out. However, Japan no longer attracts safe haven flows. The Swiss Franc, Kiwi and Loonie are more likely to do that than the Yen, but ultimately, the USD will take a huge chunk of any such flows... especially from emerging markets...
I think you and I have different ideas about how risk aversion works. I don't see it as the establishment of new positions in safe haven currencies, it is more the deleveraging of positions already established. Therefore which currencies act as safe havens has nothing to do with the situation as it stands now - it depends on how the situation stood at the time those positions were opened. In recent weeks and months the Yen has maintained lower yields than any other currency, which means, IMO, accounts denominated in JPY have been used as the funding source of the bulk of investor's carry trades. If panic hits the equity markets those positions will be liquified feeding back into JPY.
si hoc legere scis nimium eruditionis habes
  • #148
  • Oct 12, 2013 2:12am Oct 12, 2013 2:12am
Mark Knopfler is a better songwriter and guitarist than Eric Clapton. There, somebody had to say it.
Some of their videos are a bit cheesy for my taste (Romeo & Juliet, Tunnel of Love) but a lot of Dire Strait's lesser known stuff is amazing.

Inserted Video
si hoc legere scis nimium eruditionis habes
  • #149
  • Oct 12, 2013 2:15am Oct 12, 2013 2:15am
Quoting Rag2RichesFX
{quote} I'm going to smash $17.50 with longs (tight stops, 1;50 risk reward long term) Its impossible for a break of the lows (18.24?) to happen WITHOUT creating a MONTHLY divergence. Last time EURO saw a monthly bullish divergence was July 2012, and we all know what happened since then. https://www.tradingview.com/v/GBaC6Wga/ {image} {image}

you have a good argument here looking at the higher TF charts...

perhaps by the time the long trigger sets up for this trade, gold will also be much lower...

at the moment, and specially with the move in the last 36 hours (in the PM's), things appear to be looking for more downside...
90% of people, are wrong about 90% of everything, 90% of the time...
  • #150
  • Oct 12, 2013 2:23am Oct 12, 2013 2:23am
Quoting numbnuts
Mark Knopfler is a better songwriter and guitarist than Eric Clapton. There, somebody had to say it. Some of their videos are a bit cheesy for my taste (Romeo & Juliet, Tunnel of Love) but a lot of Dire Strait's lesser known stuff is amazing. http://www.youtube.com/watch?v=P9K27HvhDxA

ooooh boy, you walking on some thin ice there!

there is no doubt that is was not given as much cred as he deserves, and the songwriter part can also be argued (very subjectively) but a better guitar player...
lol
90% of people, are wrong about 90% of everything, 90% of the time...
  • #151
  • Oct 12, 2013 2:34am Oct 12, 2013 2:34am
I don't trade gold - I use it as a tool to measure other economic factors affecting currencies, but heres a couple of further points to consider

Gold wont move significantly lower without that move being accompanied by one somewhere else - usually in SPX or USD. Right now gold has an inverse correlation with SPX500 so when you say "gold is going to go lower" what I hear you saying is "SPX is going to go higher". If you don't think SPX can go higher, don't sell gold.

The last COT report showed gold to be very overbought by large speculators. The only time I pay attention to COT positioning is when I notice large specs are either almost all short or almost all long - this doesn't happen often but when it does it is a very powerful indication that the instrument cannot go any higher/lower. Thanks to the shutdown the last COT report we got was info from Sept. 24 - since then price has fallen steadily but not the sharp drop usually associated with large specs pulling back from extreme positioning. I wouldn't dare trade on this myself without seeing a fresh COT report, but I think it is safe to assume it has more downside potential than upside.
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si hoc legere scis nimium eruditionis habes
  • #152
  • Oct 12, 2013 2:40am Oct 12, 2013 2:40am
Quoting Mr. Scott
{quote} Hi guys, Great job here. It is difficult for me to keep up with everything, so here is my small contribution on gold. I have good potential area for bounce and similar first target as DHT based on pattern. Further, ultimate target of pattern is potentially 1026 if it plays out. Good trading, Scott {image} {image}

thanks for jumping in Scott

your downside target is interesting because "technically" speaking, gold has a lot of potential downside within a larger Bullish secular trend... I also think that is generally where things are headed

I am more interested in the ramifications for a gold move like this on the broader economy... ie: imagine that we are in november of 2014 and gold is at ~$1100... this would have to mean one or more of the following:

1 - risk is being priced at a massive discount to October 2013 and carry is back on (even though yield spreads may decline, system wide leverage would go up)
2 - the DXY is sitting at or close to multi year highs
3 - US10T's are in the 150-180 range
4 - SPX at multi year highs (I am looking for ~1800-1850 by next year)

points number 2 and 3 are contradictory at the surface, but we have seen it happen before (Fall 2008- Spring 2009)...
but what I cannot reconcile is having "Risk On" (bearish for gold) AND a strong USD... UNLESS the FED is funding itself using Yens...

add: apologies if this post doesn't make much sense. i will edit it after i have infused some caffeine into my system... hopefully it will make more sense
90% of people, are wrong about 90% of everything, 90% of the time...
  • #153
  • Oct 12, 2013 2:51am Oct 12, 2013 2:51am
Quoting theDHT
{quote} ooooh boy, you walking on some thin ice there! there is no doubt that is was not given as much cred as he deserves, and the songwriter part can also be argued (very subjectively) but a better guitar player... lol
lol, didn't take long to get a bite. Maybe not that much better, it's all subjective. I am a Clapton fan too - but some of the hype about EC is a bit over the top, and Knopfler is definitely one of the most underrated musos ever. I think at the least he can do everything Clapton can do.
si hoc legere scis nimium eruditionis habes
  • #154
  • Oct 12, 2013 3:00am Oct 12, 2013 3:00am
Quoting numbnuts
{quote} lol, didn't take long to get a bite. Maybe not that much better, it's all subjective. I am a Clapton fan too - but some of the hype about EC is a bit over the top, and Knopfler is definitely one of the most underrated musos ever. I think at the least he can do everything Clapton can do.
at least we are talking about real musicians here!

his reason for being under-recognized is simple: his tits are smaller than Katy Perry's



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Mickey Mouse Club 4EVA! lol
90% of people, are wrong about 90% of everything, 90% of the time...
  • #155
  • Oct 12, 2013 3:05am Oct 12, 2013 3:05am
Quoting numbnuts
{quote} I think you and I have different ideas about how risk aversion works. I don't see it as the establishment of new positions in safe haven currencies, it is more the deleveraging of positions already established. Therefore which currencies act as safe havens has nothing to do with the situation as it stands now - it depends on how the situation stood at the time those positions were opened. In recent weeks and months the Yen has maintained lower yields than any other currency, which means, IMO, accounts denominated in JPY have been used as...
Yes there is a liquidation of carry trades effect as well and that will certainly play into the flows. However, safe haven flows are not exclusively carry trade liquidations. It would be nice if it were that simple.
Those who say it cannot be done should not interrupt those who are doing it
  • #156
  • Oct 12, 2013 3:27am Oct 12, 2013 3:27am
Quoting Mr. Scott
{quote} Hi guys, Great job here. It is difficult for me to keep up with everything, so here is my small contribution on gold. I have good potential area for bounce and similar first target as DHT based on pattern. Further, ultimate target of pattern is potentially 1026 if it plays out. Good trading, Scott {image} {image}
Nice projections Scott and approximately in line with mine. I'm actually looking for a double bottom (give or take a couple of bucks).
Those who say it cannot be done should not interrupt those who are doing it
  • #157
  • Oct 12, 2013 3:53am Oct 12, 2013 3:53am
Quoting theDHT
{quote} his reason for being under-recognized is simple: his tits are smaller than Katy Perry's
hmm you could be right - Meat Loaf has sold more albums than Straits or Clapton, and he doesn't play guitar OR write his own songs.
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si hoc legere scis nimium eruditionis habes
  • #158
  • Oct 12, 2013 4:01am Oct 12, 2013 4:01am
Quoting numbnuts
{quote} hmm you could be right - Meat Loaf has sold more albums than Straits or Clapton, and he doesn't play guitar OR write his own songs. {image}


almost fell off my chair!
90% of people, are wrong about 90% of everything, 90% of the time...
  • #159
  • Oct 12, 2013 5:34am Oct 12, 2013 5:34am
Analysis for the coming week
I believe the standoff in the US government will end - I want to take a position that will maximize profit if this happens while minimizing risk if it doesn't.

IMO, EUR/JPY is forex's most accurate gauge of risk appetite, the highest yielding of the big three currencies vs the lowest. If the shutdown ends risk appetite will return which is bullish e/j.

The charts below show eur/jpy and the four major equity indices - from top to bottom Nikkei 225, FTSE100, SPX500 and EuroStoxx50. Normally the four move up and down together as shown by the 100 day moving average. Last week however I noticed Eurostoxx wasn't following the others - while the other three indices retraced toward the 100 SMA it held its ground and when the others rallied late in the week on positive news from Washington, Eurostoxx rallied even harder and forged a higher high. I think Eurostoxx50 is overbought compared to other markets. If the US govt crisis is resolved, which I think it will be, all stock markets will rally - which is bad for JPY - but I think Eurostoxx wont rally as hard as the others which is good for EUR. In the past when Eurostoxx has diverged from the other indices E/J tends to go the other way.

The ECB is also starting to pull back from its dovish stance, as economic data continues to improve.

On my daily charts EUR/USD is turning upwards from support and sitting above the 100 day SMA while USD/JPY is turning sharply upwards from confluence of support levels and a major trendline. EUR/JPY is rising in an upward channel above the 100SMA as shown below.

The only things holding me back are uncertainty on whether the US standoff will be resolved and COT data, or lack of it - last data I saw showed JPY very close to being oversold. There has been no fresh data for two weeks, but it will come if the shutdown is resolved (which is also very bullish e/j as I said before). Before placing a full order I need to see that CFTC JPY positioning has pulled back from its extreme short levels.

I usually stick to the major pairs and only take trades against USD, but all the US economic reports which haven't been released in the last two weeks are likely to be released all at once this week - this includes NFP/unemployment, inflation reports and CFTC data. This will likely cause havoc on USD and make it untradeable, at least with my approach.

I am starting the week with a small e/j long - If the US crisis improves I will rapidly add to the position, especially if COT data comes out showing JPY has pulled back from extreme short positioning.
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si hoc legere scis nimium eruditionis habes
  • #160
  • Edited 8:12am Oct 12, 2013 7:52am | Edited 8:12am
Quoting numbnuts
Analysis for the coming week I believe the standoff in the US government will end - I want to take a position that will maximize profit if this happens while minimizing risk if it doesn't. IMO, EUR/JPY is forex's most accurate gauge of risk appetite, the highest yielding of the big three currencies vs the lowest. If the shutdown ends risk appetite will return which is bullish e/j. The charts below show eur/jpy and the four major equity indices - from top to bottom Nikkei 225, FTSE100, SPX500 and EuroStoxx50. Normally the four move up and down together...

I tend to agree with this thinking... and even though I got an early signal to get long this pair on Wednesday, i opted to stay out to avoid unnecessary agony over the weekend!

the big question in my mind is WHEN will this issue get resolved? it may well be tomorrow, but it might also be pushed to the end of the month (there are no external coupon payments due till November)... which may cause a disruption... for me this would be a great buying opportunity... either way, going into the holiday season, I am pretty optimistic about the risk on theme...

there is also the consideration of headline shock when all the previously unreleased economic data does finally come out... it may (and likely will) cause some volatility...

But, once that is resolved, like you, I am looking for a risk on move across most assets... EJ being a great barometer of market risk sentiment as you suggested

I have posted some charts about this pair recently, and the upside looks very attractive on a risk/reward basis... the issue as always is timing... better to wait and lose a couple of bucks, than to get in too early and lose the house!

to further this thinking, here is an attempt to count some waves on this pair (something I rarely publish)...

I use EW on high TF's and only when the counts make sense, I am not a fan of forcing wave counts and subdivisions (xyz etc)... and if a correction goes past a simple ABC, i lose interest immediately until after its confirmed to be over... in this context, we can see that the Wave 5 high was taken out, which suggests that the correction is over and we should continue moving higher....

those here who have seen my previous work know that I like to keep things simple!

while my counts may seem pedestrian to some, they are technically valid and serve their core purpose: to orient me in the right general direction...

I hope you guys find it useful

EJ
Weekly
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comments are welcome!
90% of people, are wrong about 90% of everything, 90% of the time...
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