The Grind

[PlanTrader]

This board is excellent! LOL

[PlanTrader]

Gold & Silver (futures), possible breakout ~1800 for gold, ~36 for silver.

I'm not sure I like the odds of another breakout being worthwhile, but who knows. Good consolidation just below those levels recently & those levels are also past resistance.

[PlanTrader]

The SDS trade went +3% last week, but stopout breakeven today on market strength across the board.

[PlanTrader]

Swing Trade Oppty: S&P Downside, SDS (2x inverse S&P ETF)

We've got a well-defined risk profile right now with the S&P at a multi-year high & consolidating within a fairly tight range.

My Plan:
SDS
Entry at market, 13.30 area (the closer to 13, the better)
Target 1: 14.50 area, or depends on action
Stop loss: 12.90, at current 13.30 Friday closing price, a 12.90 stop would be a 3% risk

[Fibonnaci Kid]

Update: Spot Gold $1634 Break out level
This level held and spot gold climbed from 21st August to current date 31st August 2012 at $1692.47.
I now see a strong retrace or bounce off the $1695 -$1700 level and advise taking profits. Hope you guys and gals got some !!

[Fibonnaci Kid]

Hi Plan Trader:
The price levels on my platform (in bold)seem to differ from yours. Please check (I have copy and pasted your text into this thread) and added my comments in bold:-
6/19 high 1634.3 (1633.29), then what about 6/15's (1633.78) high or 6/6 high which are both above that?

In a situation like this, we'd either play the first breakout on pattern breach, or we'd play the break of the nearest recent high prior to that (7/3 & 7/5 highs), or else we'd play the ultimate breakout past 6/6's high of 1642.4 ($1640.92). But to do that, then why bother tracking the symmetrical triangle which had entry a way's below that around 1620 or maybe slightly lower? See what I'm getting at? To me, 1634 is in the middle but already missed the breakout.
The symetrical triangle has already been broken in my opinion and we look to the outer triangle and the s/r candles levels (March to August). Hope that explains my reasoning. The inner triangle is still relevant as a support (bounce) or a break down - quite likely given the current market action.

[Fibonnaci Kid]

Spot Gold $1634 Level: I see Spot gold key candle lows/ highs at levels $1630 to 1632.5. At these level we have candle lows (resistance)mid March through to mid April. We also have current candle highs from early June thro to 27th July. For a strong swing trade we need a strong catalyst and volume/ momentum to launch of these highs and through the strong resistance. This has not happened as yet and may well take Fed`s Bernanke to apply qeiii before we break through. $1634 (or equivalent nearer the time on the GLD etf) would be a strong break out where previous resistance becomes support.
Triangles: There are two at present with
the outer triangle with down trend line thro 7th Sept 2011 & 9th Feb 2012 giving a target breakout up to $1663 for T1 and if this breaks we target $1700.
The inner triangle (current Aug 2012)down trend line (1st & 12th March - 6th & 18th June. We had minor break outs of this main trend line on (3rd, 4th & 5th July which did not hold. The trend line has now been broken on 25th July at $1597. Therefore the second (outer) trend line comes into play as a marker. The current price movement 15th May - 2nd August has developed sideways with slight ascending triangle (up/ down ranging action) with highs all looking to test the $1630 level. The further sideways we move then the outer triangle trend line down comes into play for a breakout target and the key level $1632.5 to hold on the breakout. I err on the safe side to enter at $1634 as suggested.

[PlanTrader]

Recent gold & silver breakouts turned out to be false starts. Lot of weakness after breakout (same old story, headlines drive the market).

[PlanTrader]

Kid, what's the 1634 price breakout based on? If we play the symmetrical triangle on daily chart the breakout is right around current prices 1616 give or take depending on tolerance, maybe 1620.

If we play the next most recent highs it'd be 1626.

If you're referencing the 6/19 high 1634.3, then what about 6/15's high or 6/6 high which are both above that?

In a situation like this, we'd either play the first breakout on pattern breach, or we'd play the break of the nearest recent high prior to that (7/3 & 7/5 highs), or else we'd play the ultimate breakout past 6/6's high of 1642.4. But to do that, then why bother tracking the symmetrical triangle which had entry a way's below that around 1620 or maybe slightly lower? See what I'm getting at? To me, 1634 is in the middle but already missed the breakout.

But to your point, if we get QE hype then anything below 1643 will be a very nice low entry. It's just that managing risk with those entries is harder.

[Fibonnaci Kid]

Agreed SLV and GLD is the way to go at equivalent spot gold price level $1634 for a break out.

[PlanTrader]

Thanks Kid, good stuff. Is difficult to swing trade unless risk appetite is sufficient right now because the catalysts conflict themselves & individual news & data seem to drive the price lately.

The daily chart gold symmetrical triangle has occurred, although sputtering so far.

Silver poked above 27.70 this morning which was a break of its resistance price level also.

I don't think I have the risk appetite for trying to swing trade these price levels via futures. But SLV & GLD are a good alternative as there's no minimum size (min size on futures is pretty large).

[Fibonnaci Kid]

Spot Gold Key level $1609 - $1610: Nice call Plan Trader as per your previous post on watching the $1610 level for break out. Agree this is not a clean break out today for swing trade given the +ve US data today counteracting on the Euro strength and stalling the rise in spot gold. The US unemployment figures are key to Bernanke moving towards more QE and this has been counteracted today. So I see still more of the same volatility and news driven price movement. Still difficult to see an emerging trend particularly as the Eurozone crisis is still going to throw up more negatives for spot gold. $1632.5 I would see as a key support level to break and hold for a swing trade entry $1634 up to T1 $1667 and T2 $1747 with stop loss $1602.5

[PlanTrader]

Not a clean break for gold today at all. It had gone up too much already in the same day by the time it hit 1605. Was tough to trade unless you caught the 1580s-1590 area breakout early in the morning.

Maybe the 1620 area true breakout will be cleaner. We'll see. Central bank misc re: Europe, strengthening the Euro, seems to have sparked some gold strength.

[PlanTrader]

Gold (spot) is near 1st entry breakout $1605. Silver isn't at its breakout price yet.

[PlanTrader]

Gold & silver both weak this week so far, consolidation & churning within the noise. Time will tell. But neither is close to breaking out as of today. That could change quickly in this headline driven market.

[PlanTrader]

DBA, I'm going to exit if it breaks below 7/18's low of $29.49

[Fibonnaci Kid]

Gold:Market Sector Condition:
China to heat up the gold market August 31st 2012. Ref attached link. This has good potential to add nice consolidation on a swing trade play entered in early August.
http://seekingalpha.com/article/736221-china-aims-to-be-major-gold-trading-center-with-interbank-gold-trading?source=email_macro_view&ifp=0

[PlanTrader]

Gold & silver both found some strength today & are both somewhat near their respective breakout prices. Silver is within .40 of breakout area & gold is about $20 away.

[PlanTrader]

DBA ok so far, +.5% from entry. em

[PlanTrader]

What about shorting a financial ETF due to the LIBOR scandal? Barclays paid half a billion $ to settle a claim, they were the first to pay. But others should follow, right?

Also since the markets are fairly high right now, and lots of potential economic worry to come (Europe, China, maybe US too) we could get a nice move down & financials could retrace even harder with the Libor problems helping to push it down by sucking cash out of the banks? Thereby making forward projects of profits dampen for a while?

[trade2much]

NAVB"BIO" - PDUFA 9-10-12
Great chart and excellent catalyst date.
Fundamentals: http://finviz.com/quote.ashx?t=NAVB

[PlanTrader]

Gold & silver on watch: gold breakout 1610, silver 27.70

Edit: of course they could also both move down notably, but we're taking care to be ready to play a breakout if there's new talk of QE by the Fed.

[PlanTrader]

DBA couldn't bust out today, intraday volatile & after each move up a sell volume spike would knock it quickly back down. Tomorrow might give us a better clue on the action.

[PlanTrader]

Wow, crude got up near $93 today, 4.5% above that $89 breakout price we discussed. Middle east tension, yada yada, there's no way to know which catalyst will take control with oil lately. Inventories at multi decade highs = bearish. Slower demand growth globally & more US oil output = bearish.

Geopolitical tensions & price needs/aspirations = bullish.

[PlanTrader]

Thanks trade. Want to take a stab at entry price & stop price?

[PlanTrader]

DBA triggered in today, 30.10. em

[trade2much]

HZPN 7/26 PDUFA should start to move

[PlanTrader]

DBA hit $30 today, entry not reached yet. The close was near our entry price, so it could gap over our entry tomorrow. If it does, sobeit, no chasing.

[PlanTrader]

No suggestions? We need a couple more guys here to eyeball some markets. I'm not sure which sector would be ripe for shorting if we get some weakness. I thought maybe retail, since recently consumer spending has been iffy.

[PlanTrader]

Hey guys, the S&P is back near recent highs again... could be a breakout coming (via more QE?) or a good time to find a low risk short entry.

[PlanTrader]

Oil wasn't really in an asc triangle. USO chart is gappy & choppy. A little bit of a flag type of breakout, sort of. But oil has been trading knee-jerk on news items lately with some bearish fundamentals mixed with some Iran/supply side concerns.

Inventories are still very high, although some Ok/decent manufacturing data has come lately along with refineries cranking up production which is reducing the huge inventory stockpile. So I think oil has been going up on reduced inventories and Iran tensions lately.

Too hard to predict or guess, too many mixed factors, in absence of a good chart pattern. For that reason I'm going to stay away from oil for now. Maybe it'll setup for us better later.

[Elvis83]

Good spot. Would you say USO has broken out of an ascending triangle? Good enough fundamentals to drive an upward move?

[PlanTrader]

Crude oil is right at a breakout level @89 now. Catalysts are mixed as usual since oil is not only a necessary commodity but is also a geopolitical tool.

[PlanTrader]

Silver is nearer a breakout at the 27.65 level. Is currently in a symm triangle compression range. If it breaks out with any catalyst power it could get up to $29 area pretty easily.

[PlanTrader]

Gold broke yesterday's high & low today, and has a spinning top candlestick today which signals indecision.

[Fibonnaci Kid]

Its in nomands land at the moment within the triangle (range $1615 - $1555)and is been forced into a tighter wedge. Worth looking at this Friday for the Sunday night opening.

[PlanTrader]

Good thoughts. Maybe gold will revisit the lower range of the symmetrical triangle on the daily chart. Rinse & repeat would be nice... more room to runup on QE.

[Fibonnaci Kid]

Looks like a sideways push on spot gold with a bias downward. As the Fed plays a waiting game there is a higher likelihood of Europe airing their dirty laundry and pushing the Euro down and the US dollar up.

[PlanTrader]

Hey guys, what do you think of finding some ETFs which are up near relative "highs" so we can short a whole sector this fall or whenever we see a low risk entry (near a top or on breakdown)?

QE might prop the markets & cause a runup, but we could get some good shorts in the meantime if any sectors bump up against prior highs & we get more economic malaise news.

[PlanTrader]

Market went down hard on Bernanke today, but then ran back up even more. Odd, but standard procedure these days it seems.

[PlanTrader]

Bernanke didn't say much. Similar to what he said the last time he spoke. More stimulus is possible, but not yet, no details given, US economy is struggling, yada yada.

Looks like gold will trade in a range for a while longer.

[PlanTrader]

Kid, it's less about the catalyst & more about the price levels. The catalyst can occur any time & the Fed/Bernanke catalyst can be a major one. That's fine, doesn't matter when it occurs. The key with swing trading is to catch a move as it shows power & conviction instead of within the noise where it's more of a guessing game.

Think of it that way when swing trading... we aim to play outside of the "noise". But that doesn't mean we can't find a 1st/early entry within the noise if we feel it's valid. That's one aspect we can differ from the other group on.

Another note: A swing trade will often bounce off minor price levels & you'll be "out" of the trade if you view it that way because from a swing trade perspective you won't absorb that type of bounce-around price action & won't get the continuation even if it does occur. Unless you're watching in real-time & are aggressively exiting & re-entering. Swing trades allow all that movement (which is why many swing trades initially have a 1-2% profit but then stopout breakeven... would have been a great daytrade but not fitting of the swing method). Hanging in there is the only way to get a 5-15%+ win.

[Fibonnaci Kid]

Thanks for the qualifying comments Plan Trader. I agree with your analysis -it is indeed an initial day trade catalyst with good prospect for turning into a swing trade.

[Elvis83]

I admit it's not the best looking flag. These things aren't always text book though. I like the revised stop and exit. Cheers

[PlanTrader]

That means you're aiming for a daytrade while reserving the right to turn it into a swing trade, right? If so, please state that explicitly in your trade plan b/c otherwise it's too confusing to follow. Nothing wrong with it, but since this is swing trade board we have to be clear if we deviate from that.

The real breakout (for a swing) wouldn't be below 155 & definitely not below, nor exact at, today's high.

[Fibonnaci Kid]

Very prompt response Plan Trader: Take your point.
I expect very quick action tomorrow on Market open to hit T1 and move the stop to break even for T2 asap to continue as this will be a potential reversal if Bernanke does not lower interest on reserves. (So yes more day trade orientated for T1)with the US news data released at 1:30 GMT and then strong swing trade for T2 (post 3pm GMT)or break even.

[PlanTrader]

Thanks Kid, trade plan reminder... you have 154.75 as the entry, but the HOD today is 154.75. We always want to enter at least a little bit higher (in this type of play) in case the previous high serves are resistance.

Also, with yesterday's high of 154.94 so close above it, I'd wait for that to clear as well. Which in the swing trade world means clearing $155 (major whole # rule). $155.20 is more of a breakout; to clear 7/10's high. Remember, we're swing trading the daily chart & using more granular chart to fine tune our entry prices but don't want to trump the daily chart as far as S/R goes (if there is any).

Also, your stop is a daytrade type of stop (very small; usually too small for swing trading).

If you enter prior to the above, you might want to daytrade exit... as that type of entry is on a minor price level with potential resistance above.

[Fibonnaci Kid]

Trade Plan: GLD etf
Entry $154.75
T1 = 155.75
T2= 157.25
Stop $154.25
Catalyst: T1 - current trend up holds to test Gold future key level at $1615 ($155.75 extrapolated on GLD etf).
Catalyst: T2 - 16th July FED lowers interest rates on reserves to force banks to lend.

[PlanTrader]

Thanks, Kid. Let's keep an eye on gold re: the Bernanke speech at 10am EST Tuesday.

[Fibonnaci Kid]

Good day fellow Grinders:Got my grinding wheel out of the lock up and I`m ready to go. Tomorrow 16th July 3pm GMT Bernanke spills the beans on monetary policy report to the senate and so shift the markets. There has been talk today of Bernanke moving to cut interest rate on reserves.