Gold Market Wire
News, analysis and commentary for gold traders and investors
Gold Market Update
Gold Recovers The Trendline
December 1, 2021 - (Gold Market Wire) - Gold has recovered our primary uptrend after a volatile day, yesterday.
Those who bought early yesterday had plenty of time to trade out for a decent profit, as a day trade, or they had to ride the swoon. Both worked out well. The strategy that didn't was waiting for the market to surge; chase it near the highs, convinced that we were 'off to the moon' and then cut when the market fell a few dollars underneath the trend line right on the close - in yet another classic tree shaking exercise. The Eur/Usd 'shake out move was only 30 mins long - but many took the opportunity to fold.
So here's a classic case of how the market can cause people to panic out, when they should be waiting for the close to see how things ended the trading day. There's going to be a lot more of these in the days and months to come, so you'll need to be strategic about trading such volatility. Beware the tree shakers, who swing the market around.
The first step to dealing with volatility will be to scrap any trading on margin. The second will be to develop a contrarian eye. Thirdly, buying against the trendline, as advised worked, but only if you cut when we ramped into profit and/or didn't get chased out when we swooned. Lesson? Take 1/2-2/3 off the table if we get a sudden surge. Sure it's easy to say "run profits/cut losses", but yesterday showed the limits of that. It's better to say "don't get greedy." When lazy old Gold surges $25 an oz. in just a few minutes/couple hours - do the intelligent thing and pocket some of the money.
That's going to be the real lesson going forward. With a lot of attention turning towards Gold, the locals are smelling blood in the water. You'll have to learn to think and act like them - or you'll be defeated by them.