Gold – Discounting News
Trader Scott’s Market Blog
November 30, 2016
This post is going to be a bit heavy with a discussion about the method/the analysis – it’s boring, but necessary at times to discuss. Gold continues to trade in an accumulation area. For a while I have been repeating that trading below $1190 would be the highest probability area when/where we would set up the bottoming process, including a selling climax(es) and a series of re-tests. This area would include the preliminary ending actions (such as Nov.25th), followed by the first big rally which should be sold into. This is what we have seen so far and I am using the big pushes lower to slowly accumulate, mainly silver and the mining shares (and trade within these areas). Then on the next reaction (sell off) we would likely see new lows with the first attempt at a selling climax, which is now what is going on. There are strategies to trade these areas and then to use the profits to accumulate, but the general point is to use the volatility as your friend. And just be patient and only buy into the big pushes lower. Remember all of the good “news” about gold before the election when it was trading over $1305. Well now gold is getting battered by bad “news”, and it is doing its’ job of discounting further news, which is part of what accumulation and strong handed short covering/buying is. When the volume on the re-tests following the the selling climax(es) begins drying up, it shows we’re getting close, so that needs to be watched. It’s generally what I kept talking about late last year in my outlooks sent in to the radio show, The Real World of Money with Andrew Gause (before I started writing the blog). So here’s last September and November. And then in December, when I believed it was finally time to really step up to the plate. A bottom in markets (accumulation) is a process, not a singular event. It includes distinct singular events, but each one is all part of the process. And each step has its’ own meaning and strategy to use. Patience, as always in markets, is required.
Addendum: I have received several questions the last few days, so there are two posts which might be helpful – selling/shorting gold over $1305 from November 1 and my approach to marketsfrom November 24.
Trader Scott has been involved with markets for over twenty years. Initially he was an individual floor trader and member of the Midwest Stock Exchange, which then led to a much better opportunity at the Chicago Board Options Exchange. By his early 30’s, he had become very successful in markets, but a health situation caused him to back away from the grind of being a full time floor trader. During this time away from markets, Scott was completely focused on educating himself about true overall health and natural healing which remains a passion to this day.Scott returned to markets over fifteen years ago where he continues as an independent trader.