Gold and silver continue to torture traders
Kitco Commentaries | Opinions, Ideas and Markets Talk
Featuring views and opinions written by market professionals, not staff journalists.
Many times, we have written about the pattern of consolidation, which is also known as the greatest time of uncertainty. No markets have been more uncertain than Gold and Silver for the past few months. Consolidation will bring a new trend; the only question is when.
We know that a much bigger trend is coming. The price action over the past year in gold and silver was one of the narrowest ranges in years. All this means is that a huge move is coming, but until it does, it will be choppy trade and quick reversals in either direction.
We are long now; based on the algorithm, we will assume the market's breakout to the upside. However, there are no guarantees that this rally or uptrend won't fail. The only positive sign is the wider daily ranges. The more volatility in markets, the higher the probability of a big move.
In all markets, price action determines what will happen in the next day, week, or month. Keep the two strategies separate. The worst trade anyone can make is turning a trade into an investment hoping for a way out. Traders must learn to take their losses and move on to the next trade.
Patience, discipline, and money management always win the day. Let the map of the markets show you the way.