BANG THE DRUM

                              78’s From A Galaxy Far, Far Away

When I was a kid growing up in the 1960’s, about the only home entertainment was the stereo hi-fi [conveniently located in the TV console which weighed about a thousand pounds]. While pop culture revolved around the 45 RPM vinyl record, many older adults, and of course my parents, would have enough money to buy the 78 RPM albums.

For snickers and giggles, my friends and I would change the speeds of the hi-fi [when the old fogies weren’t home of course] so that the sounds would produce some wacky voices. We’d all laugh ourselves silly and tried to replicate their voices while we raided the frig for leftover goodies.

Of course, if you got caught by the old folks, they would whomp your backside and kick you out of the house so fast they coulda been ticketed for speeding.

One of my best friends growing up had parents who were considered “rich”, and in their house they had a Zenith color 27 inch TV with a hi-fi built into the console in cherry wood. Since it was sooooo “high-tech” at the time, it had a knob on the high-fi that allowed you to set the RPM’s for the records. So we would play 78 RPM albums at 97, or 50, maybe 70, and try and guess where the setting was.

                              You Darlings Want Some Cookies?

My friends Mom didn’t care we did this as long as we used his albums and not theirs, so we would play on this thing while his mom played the part of June Cleaver. Guess whose house we played at a lot?

With a lot more than snickers and giggles at stake today, traders face the same “game” when they assess volatility. At what point do you say it has changed? Where do you draw the line? Where are the DIP’s [discrete information packets]? In many respects, it is as subtle a process as guessing what RPM an album is playing at. Sure, when it sounds perfect you know it’s at 78, but can you tell me the RPM when Perry Como sounds like a slobbering drunk or a hyped up meth addict?

I bring up volatility a lot because it is far more important than most people realize. This silent killer is responsible for more account erosion than is widely recognized by the retail trading public. Why do you think the “big guys” can take advantage of the public over and over again, year after year?

Often times, the perception of change in gold [or other markets as well] volatility makes the market move. Of course, these perceptions are what make markets; not everybody has the same perception or expectations as the next trader. 

I have stressed many times the importance of keeping your eye on the daily range as an important indicator of volatility. I used to tell other traders in the pit that if you consistently gave me the days range [not prices] I would have all the money in the world within 2 months. This still holds true today.

So, when gold [or any other market] starts to “bang the drum”, give a good listen to where it’s at and what it is saying.

Today’s Action & Weekly wrap Up

Just a reminder, this is the last market day this section will appear on the website. All trades, with real prices, will be covered on my companion website which will be up and running sometime Sunday night. Look for a new link then.

We came into today’s action in “neutral mode”.

One of the things I really enjoy about having trading relationships with my algorithm traders is that they email me often and ask a gazillion questions. But not every day is it a one-way street, and yesterday many of you emailed me and said we weren’t in “buy mode” but in “neutral mode”. Guess what? They were right.

The confusion on my part came from answering a question on a hypothetical situation from an algo trader that I internally transferred into my head as the real deal. Now, it’s not that big of a deal since no matter what side of the trade you decide to take while in “neutral mode” [buy/sell] the worst you stand is a 50-50 split in the probability distribution for profitability. So, it’s not like I put myself behind the proverbial 8-ball looking for trouble.

Thanks go out to all of you that emailed me to let me know of “my mistake”. When I screw up, I will always be the first to admit it and give credit to those who brought me back to reality.

                        Jack Says, “Hey vegas, Where’s My Steak”?

The fact that I’m fighting a truly nasty bout of flu for the last 2 days really has nothing to do with it. I mean, it’s normal to see double and hear the dog talking to you in Spanish and wanting to know when the grilled steaks will be ready – right?

So, we came into today in “neutral mode”, looking for some volatility in todays trading to get the algorithm back into buy or sell mode. As I write this, the window for trading and initiating new positions is rapidly closing, so it is prudent to call it a week and go home. 

Besides, Jack is hungry and wants grilled steaks!

So, $ 0.00 / oz. gain for the day.

Weekly Wrap Up

                                 

Thursday                    $ 4.24

Friday                        $ 0.00

Total                          $ 4.24 / oz

Have a great weekend everyone!!

-vegas

PERCEPTION & REALITY

                                    Perception IS Everything

A few years ago, a fraternity brother from my college days dropped in, and since he was a Major in the US Air Force, he took me up in the F-16 trainer he was flying for the day. We had a blast up at 50,000 feet, but what I remember the most from the experience was experiencing not knowing UP FROM DOWN.

                                      Which Is Up & Down?

                                       [You Sure?]

The fact is, we often mistake our perception of events one way, only to find they are something in reality much different.

Markets present a laboratory of human emotions, endless data streams, and money flows that boggle the imagination. Not only do we have to think correctly, but there is another trading dimension most people give little thought too: timing.

                                   If I Wait I Will Be Rewarded

Meet my little friend “Patient  Bear”. Unlike my pal “Skeptic Cat”, who almost never does anything for fear of fear, Patient Bear knows what he wants and then waits to get it. Both, in reality, want the same thing; viz. something, anything, an algorithm if you will, that will allow them the easiest existence they can muster for themselves. In trading, hopefully you look for the easiest trade to make money.

As humans, we want that same kind of “easy existence”. What holds you back are the perceptions of getting it don’t match up with the reality of achieving it.

Until now!

                                               I’m Waiting

“The Vegas BFSG Algorithm” is FREE. If you wish to send me 5K so you can feel better about it, write me and I’ll let you know where to deposit the money. No other trading professional is willing to do what I am doing. NONE!!

While others reach into your pocket for your credit card, while preaching hypothetical results, I am here to show you how to get the kind of money and income you want from trading.

The response I have received from traders is gratifying, yet at the same time I know there are many of you who visit my website to read the posts, and then walk away wondering if this is for real. All I can say is join for FREE and find out. You don’t have a thing to lose, except the perception that somehow you can’t do it.

Gains today in all markets that trade “The Vegas BFSG Algorithm” were truly staggering. Once again, being on the right side of everything [buy mode] paid off in spades, as the timing kicked in to produce huge gains. Not just in Gold, but everything: oil, stock indices, and currencies [AUDUSD for example].

Today’s Action & Wrap Up

Like yesterday, we came in to the day in buy mode. There were 2 occasions in the wee hours [1:00 AM – 2:00 AM Chicago time] where the algorithm came very close to giving a buy signal. It didn’t happen, so we didn’t get long. The first buy signal in gold came at 3:15 AM [Chicago time] at 1707. Stop on this trade was at 1701.95 which was never hit.

At 5:00 AM, another buy signal from the algorithm at about 1707. Every market soared form there on China news and news from the Fed that they are providing liquidity to Europe. Gold immediately rallied hard up to the 1716 area.

Now, almost as if on cue, and remembering what I said yesterday about “non computable trading”, I believe there was a confirmation top at 1716. However, if you viewed the signal just slightly different than I, you would not have sold and liquidated the position. As I said yesterday, as long as you are consistent there won’t be any problem.

If you stayed long, then you definitely got the sell confirmation a little later at 1736; almost a $30 gain.

For my reporting purposes, I’m not going to exaggerate or embellish what the algorithm can do. It does what it does, and doesn’t need any help in reaching profits. So, a net gain on the day of $ 9 / oz [Realizing that some algo traders got a whole lot more. Congrats if you did.]

Ka Ching!! [again]

Have a good day everyone.

-vegas