When we look at the gold market, one of the things I told you that I expected is when you're over an 18-week average and you come back often (I wish I could tell you, it's all the or time but it's very often), the market will stall there figuring out what the next move is. When we look at the daily bar chart today, you had an outside day to the downside.
Now, I believe that outside days are telltale signs. They're either a continuation pattern or assign that something is ending. Now, let's first discuss the sign something is ending. We've had a short-term rally that has culminated maybe with that outside day down.
...I can tell you, that if you take out today's highs tomorrow or the day after it's a signal, you probably want to even move higher. So this is going to give the bears an area that they'll look at on the chart. The market did not take out previous highs. It's right at the 18-day average.
In my morning subscriber video, I said, 'Wouldn't surprise me if the bears sell here, put a stop over the recent high and they look to see if you get back into these lower moving averages.' I didn't like the risk-reward on the trade, but that doesn't mean you're not studying the pattern.
Now, if you take out that high, where could you be going? Then it's the Bollinger Band possibly, $2075, but what would make the market pick up there is what I'm wondering and it would have to be something terrible going on in the Middle East.
About the author
LINN & Associates
Over the past 35-years Ira Epstein has developed a reputation for providing clients with easy to use technology and teaching good old fashioned trading know-how. A number of our brokers have over 30-years trading experience. No matter how technology changes the methods of entering orders, there's no replacement for having "been there and done that before". It's the blend of services that brings things together.
Be it education, market information or trading platforms, we provide solutions.
Ira began in the futures markets in 1969. Over the years he worked his way up, starting from the ground up as a "floor runner" culminating with his becoming a Floor Trader. In the mid 1970s Ira decided to make a career shift within the industry to develop both retail and commercial based clientele. His customer base grew to the point whereby in 1984 he founded "Ira Epstein & Company", a trading firm specializing in retail, commercial and self-directed discount futures trading. Along the way Ira became a leader in trading technology out of necessity, due to increased small lot trade volume. He was among the first to embrace the Internet, which as you know has dramatically changed both the way information is delivered and how trading takes place today.
One of the ways Ira, along with his brokers showcase their talents is through e-mails of market information and Ira's "Futures Videos", which can be viewed on our website, through Market Center, Linn-IraChart Software and on YouTube.