Friday, December 2, 2011
Gold/Silver forecast
I have initiated a short gold trade today's opening. This can be done on silver too, due to correlations. My thoughts are to short gold between 1750-70 with a target below 1700 by january. I will run a careful analysis this weekend, to find exact numbers, but wanted to publish my trade as soon as i had time. The chart below explains my logic, along with the ES discussions in yesterday's article.
Subscribe to:
Post Comments (Atom)
3 comments:
Unfortunately, my gold short attempt, got exited due to a trailing stop to lock in profits last week. But, if anyone is following this trade, and still holding out for the 1700 i projected in this analysis......here is my first target according to this weekend analysis = 1674, which is a place to exit atleast 50% of the shorts, locking in profits.
Gold futures reached the bottom of the triangle pattern on monday, 12th december. Right now it is starting a bounce back upwards from the bottom support line in triangle. There is a possibility that gold will go lower in coming months. Even if one holds a negative sentiment on gold, it would be wise to set a stop loss at 1695, which would be about midway into the triangle. Alternatively, one can lock in profits, and wait for the break of support, before another short, which is my preference.
With today's fed announcement, the case for gold short continues, with a break of the green support line in the chart. The idea of hanging onto 50% of the shorts was useful, since the stop loss at 1695 did not get triggered. I continue to think that a loose stop loss on gold is necessary, to reach my first target at support level of 1595 area. Various fundamentals have been in place since November 30th, when central bank intervention happened, to support the idea of gold short. We will discuss the fundamentals on this during the weekend.
Post a Comment