March 4th

Here is the Global Gold Index chart for the morning trading. This time, as I mentioned, I did some trading and got caught in the morning churn. The overall up day that I was anticipating did not happen as of yet, but that is of little concern as I follow what the averages, pivot points and price movement are doing, so even a bias is not that big a deal.

I should have stopped trading sooner than I did once I realized what was going on...or more appropriately, what was not going on. The spreads were unusually wide, as much as five cents at a time which is unusual and probably is a good sign that the market is undecided...now this is only in the ETFs HGU and HGD. So there were no defined moves.

It should be noted that these quotes do not drive the market as they are reflecting the sentiment of ETF traders. Seeing as they were unsure I should have just stayed out. A good chunk of the actual loss of each trade was due to the spread as I entered three or so cents farther away than I needed in a lot of cases. I saw a number of even 100 lot quotes on both sides and about as far away from the inside bids, they did some dancing about as well. I suspect that these were the market makers doing their job of providing the necessary liquidity as they showed up when the quotes were very thin for quite some ways away from the inside. I definitely stayed away then as the spreads were larger and the price was flitting about.

I happened to try to trade off of the averages a bit. I should know better than to do that when they are so close to one side of a pivot zone. Although my rules were fine for yesterday and Monday I think that I will change my entry criteria a bit for tomorrow. Use the averages ONLY to determine if a trade has too narrow a target, the good ol' squeeze play. Confluences must be more confluent.

So, taking my plan back to some bare bones entry criteria now to eliminate the questionable trades and only sticking to those that are more defined. I think this will give me fewer trades as I use patience to wait for the setups, perhaps I will employ some limit orders again as they slow me down a bit. I never had enough of a move today to use them but I was going to use some manually trailing stops had I got on the right side of a decent moving trade.

Overall another learning day.

Jeff.

March 4th commentary

Monday the eastern markets dropped, Tuesday they dropped, I tracked some very nice trades as a result of those days as I knew, or expected, a similar trend in the TSE. At the very least a fairly wide swing. I was not able to actually get into the trades, which was too bad.

So, my trend has been to track some very profitable days only to decide to jump in the next day and get churned about in a tight ranging market. Today has been no exception.

The worst of today is I knew that the Eastern markets had at least gained a little, which would lead me to believe that the TSE would be rather tight...or at least Global Gold would be as I pay closer attention to that than the market in general.

So a few small profits and more small losses as I get whipsawed out of trades. I should have waited for the moving averages to close the gap to 1/2 R1. I kind of expected an up day, but overall. If I could have called the bottom I would have done OK but the bottom did not correspond with any of my indicators, so no bottom trades. Although once it was established I could have made two bottom trades as there are three bottoms around the $299.50 mark. Once again, not on any of my indicators so I left them.

I will do some more trading a little later and see how it goes.

Jeff.

March 3rd, PM

Chart for Global Gold Index in the afternoon.



There was an extra $124 net in these trades. Not bad for a couple of hours trading. So today's total would be $343. Applying my various fudges, 30% reduction is $240, dropping my top two trades leaves $148. Either way the return is tax free so I would take them.

Jeff.

March 3rd, the AM, stuck on gold still.

Annotated chart for the Global Gold Index for the morning activity.

As usual red arrows indicate a short trade (Long HGD the bear fund)and the green are long trades (long on HGU the bull fund).

This is a far quicker method of noting these trades. It makes it easier to review them for me so they must be easier for someone else to read as well.

I am playing with a manual method of trailing stops so I am not actually trading these but using the stops to check how much of a particular move I may take. I was having trouble getting too far in the red on trades last week, even though they were small losses the small loss adds to the commission cost and drives down my profits. I determined that the stops are not great at profit protection (I knew this but it is a good reminder, they are called stop loss after all) so I will use them to keep me from taking a greater loss than I planned on and to also act as a safety in the case that I have a connection problem like I did last week.

My tracked trades today netted $219 prior to the noon hour. I was only able to use 300 shares per trade due to the price being around the $10 plus mark. The last trade was nice in that I used the stops and did not jump them too soon, I figured that since I was far enough into profits that I could let it sit until the next target was reached before moving it up...it worked to keep me in the trade past that little consolidation period.

Jeff.

March 2nd the afternoon missed...chart analysis

Oh well. I considered trading in the afternoon, stuff came up so I was not near a computer long enough to check any of this.

While I may not be actually trading every day I feel that it is still important to analyze the charts afterward, and during in some cases, to stay familiar with the action and to notice any particular patterns that emerge that may have been missed otherwise.

I have changed my format a bit here so rather than carrying on about the trades I put the notes right on the chart. I figure this keeps my word count down, makes the notations mean more and makes the written notes relevant right where they are needed. I used to do this for my charts and I found it problematic due to all the lines and notes I used to keep. Now with the pivot points and the simple moving averages being all that are on the chart it is a much cleaner notation environment and easier to keep up. So just click on the chart for the full view and you will see pretty much everything.

Do Keep in mind that these are as much for me to keep track of my ramblings as they may be for others to read. So if anything isn't clear and you would like it to be then let me know. Otherwise, read or ignore at your leisure.

So here is The Global Gold Index for the afternoon trading:

I did a quick estimate on the trades in the PM, out of curiosity and found 51 cents per share (at 400 shares over four trades that is $156 net.

I am finding that in order to be consistently profitable I think that more time might need to be spent in front of the computer. While I am not trying to scalp every small move with huge position sizing, the "classic" day trading stereotype, I don't think that I can do the 1 hour in the morning and be profitable every day due to the large and fast moves early on. They are great when they materialize but they are a little aggressive, not to say that I won't trade them though.

Jeff.

March 2. The morning missed

"...The Asian markets are taking a hit...".

I am not one to trade on news but the opening markets on the other side are a very good indicator for the morning bias, especially when the news is "bad". So, even though I had decided to not trade I did keep one of my charts up to see what was happening while I did the mundane regular work that I am required to do.

Global Gold Index. This is the morning activity. As usual red arrows are for short (buying HGD bear fund) and green are for long (HGU bull fund).

I may change one of my rules to allow for more trend following trades rather than playing in the chop. Usually one or two days a week exhibit a really good initial trend and that can be traded far more profitably than trying to get in on the chop.

Today was a nice example of one of those days. Even though the first trade setup was minutes into the morning I would have jumped on as the price peaked and passed 1/2 R1. For reference the HGD entry price was about $8.65 (playing 5 cents higher than my likely entry). The price dropped so cleanly through the primary pivot point (PP in blue) that there was no way I would have bailed on this trade. The price dropped to just below the 50sma, a decision moment as it hovered between the 50 and the 200smas..."Asian markets are taking a hit", the bias is still down for me. There was no rally back above the 50 and that was the sell point for me at this point.

Gap down under the 200sma, now breaking above the 200 would be my sell point. It held and plummeted yet again clean through the 1/2 S1, no sell trigger here either. The price bounced off of the S1 and I would most likely have sold here...but...I held a strong bias to the downside and I had $260 unrealized gain so far...I could afford to hold through and I may have with a very firm mental stop...with this much of a paper profit I probably would have placed a stop order to secure $200 and it would not get hit as it turned out. This is a good application of a VTSO of about 15 cents...that is hindsight though. I would ratchet this manually at 10 cent increments once the price has moved 20 cents away from my stop, raise it 10 cents. Should I want I can just keep moving the stop tighter to secure more profits or cancel the stop and place a market to exit.

I would use the stop moving only after a decent profit is already built in and I had a good feeling about the move. This method this morning would have captured me $1.25 per share...at 400 shares that is a nice $500. I used a trial forex account last evening to practise my stop moving as I have not used stops in a while. Made a decent chunk of virtual change for my playing too. It appears that pivot points have their place in forex just as in stocks...and 24 hour trading.

On the flip side the price followed a very similar pattern back up. The first trade, using the profit stop at 10 cent increments would have kept me in until the time at the 200sma when I would have exited anyway. Getting back in would have been clean right after passing the S1 line on the upside. Nice couple or few trades there as well but I didn't calculate the profits, about 70 cents possible capture though.

All in all a good day had I been in the market. If this follows true to form what will happen is that I will decide to trade tomorrow and the day will be flat and I will have to fight for pennies again. This will just point out that my idea of having to be in the market every day in order to capture the larger moves is better than trying to pick the day that a large move may occur.

Jeff.