Thursday, June 21, 2012


                                            Never Say Never

One of the most worrisome things I see in the marketplace [pick one, any one] is the outright selected manipulation of currency pairs, stock prices, bond prices, and of course precious metals. It doesn’t always have to be direct intervention; most often in the currency pairs it is selected, timed, press releases to inflict the most harm.

Our friends at the BOJ, MOF, IMF, BIS, and a host of others, all play the manipulation intervention game.

The reason I bring this up is to highlight the eventual futility of this process. Sooner or later, the math works out the right way; of course you could be broke by then, but that’s your problem, not one for the market.

Take gold for instance; priced as I write at $1564, it’s 20% off its high from August 2011. Is there any person alive who really thinks anything in the world is better off from 10 months ago? Is Europe in better shape? Is the U.S. fiscal and monetary condition better? Has the deficit gone down? Have the money printing presses stopped or even slowed down?

Of course not, everything is worse.

For us traders, it is particularly hard to ignore the waves [tsunami’s really] of massive buying/selling that hit markets in a microsecond and can make the difference between having a nice day and trying to recover for the year. Go ahead, ask me again how much I hate gold dealers?

One thing is for sure; you can never say never when trading.

“Oh, I’m not worried, there’s no way the Euro can go down/up from here. No need for a stop.”

In case you are wondering, the photo above comes from the Rio Casino in Las Vegas, where the number 19 was hit in roulette 7 times in a row. The odds of this happening is 114 billion to 1.

“Nah, no way can we get another 19.”

“Uhm yea, OK.”

Next time you make a trade, think about this for a second.

Have a good day everyone.


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