As you take a look at gold, you had a spike last weekend, you followed through. So the logical thing is to say that you've made a trade top of sorts. The second part is the market had buckled under the other day...
And now you're right here for the Friday trade, so you're getting a bounce. Look at the lower highs, lower lows. Where did the market go? It went to the 18-day average—and I'm going to back up here for a minute. That's the first hit of it. You closed down, and now you're coming up, and it wouldn't surprise me if you want to get back and play at that number.
While the trend is down, trying to go short at $3271, the nearest stop that makes sense is $3359.30—right over that. That's too much money to risk. Downside: If the market keeps falling apart, wherever the Bollinger Band comes in—right now, it's at $3058—that would be about a 15% break from the high. [It] could happen, but I'm not expecting it just yet.
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.