Meanwhile, At The Bullish Gold Institute
If there ever was a day for capital preservation, THIS WAS IT. After my first crude oil trade, I deliberately walked away.
“Gosh vegas, why did you do that?”
“I don’t know, maybe it was the $50 / oz decapitation stop hunt of longs when the market went through 1762. Or, maybe it was the $1 / oz price quote changes, which I can assure you would have been larger if you bought or sold. Or, maybe it is the fact that my first priority as a trader is to stay out of trouble.
On February 21rst I posted an article “Cracks In The Foundation”, in which I told all of you that things weren’t right in the gold market; that what I was seeing told me to stay out. Now you know why.
For months I have been saying to all of you to NOT place your gold sell stops where everybody else places theirs. After today, if you still have a trading account, do you understand now?
Going forward, gold is not out of the woods. If we get an early rally in Asia, the dealers and every hedge fund in existence will sell it with a vengeance. And if you’re long, and have your sell stop anywhere between 1701 – 1699, don’t be surprised if you get filled at 1688 or lower.
Compounding the problem is the very large purchases [see www.zerohedge.com ] of silver by hedge funds in the last few days. Where do they go now?
Hopefully gold is starting to regain its normal trade; we’ll see what happens tomorrow and Friday and I’ll comment about it then.
Have a good day everyone.
For my take on crude [ http://vegaspamm.blogspot.com ].
P.S. Too late. Gold below 1700 as I post.