Mercury

My views on Gold look like this: There is compelling NMD on the recent top out at resistance so a bearish phase was indicated Maybe this has completed at the Fib 50%, maybe not as the price action is consistent with an A-B-C retrace and a drop back down to Fib 62% or another test of the LT trend-line, time and price action will tell that tale Can't rule out a breakthrough rally from here Trading strategy: Hold previous Longs with suitable stop protection to avoid a stop out and rally Look for price action turn signals at Fib 62% (Triangle breakout zone) or retest of LT trend-line to go Long Whatever happens (other than a collapse in Gold) trade Long on a major strength breakout of the over head resistance and begin a long term trend following Long campaign. Thoughts on the Trading ideas anyone?

Quick update on Silver, The Triangle Line doesn't really work as well as a simple trading range set up. A break out of this range sets up a strong rally scenario. At this point I am favouring another run back down to support, coincident with a completion of an A-B-C retrace on Gold USD falling and a rally in stocks. If this happens that speculative longs with close stops at key turning points on Gold and Silver will be an opportunity. Failing that a breakout of key overhead resistance on the Daily chart will be a major opportunity. The only issue I see with a speculative trade at the support level is that this range could carry on for a while yet and the moves between the top and bottom can be very choppy so I will not be trading anything within the ranges, nor shorts from the top as my bias is for a breakout into rally. Trading strategy: Wait for a hit and turn on support level for a spec Long with close stops and, or Wait for a break through of Resistance if consistent with other markets moves and go Long Thoughts on the trade anyone?

Just to update on the above, the market has indeed regained the upper Flag line and broken through, remains to be seen if this is confirmed with a close on the daily candle above but the force of the move is significant and after the bullish fake break below it bodes well for an ongoing rally, which can be a precursor to a stocks rally. On the Daily I am looking at a retrace termination at Fib 62% or 76/8%, which could come just before a termination of Stocks rally, one to watch.

Looks like our posts cross each other in the ether @TrendFollower but thanks for that, I see more clearly where you are coming from. One question though on what time-frame are you using MA, is it Daily? I think you said Day MA so Daily right? So I am most def not a politician, I speak too directly for that, I just wanted to understand where you were coming from so I could have context for any answer. I didn't trade this market because I had others I was more interested in and I was unsure as to whether we have see it top out. If I was going to trade it I would have looked for a 1-2 retrace off the bearish move from a rejection at the Weekly channel top line. I would have looked for a turn back down at resistance, preferable at a recognised Fib level (62% is most usual for 1-2 retraces). If I missed that first turn, often happens if it is swift, I will look for a smaller scale 1-2 and then a drop though support (or in this case a nice ice line from previous price action turns). Stops placed just above the Fib 62% pin bar as a reversal past this level negates my road map. Once the move gets going ti can be pyramided at signficant retraces, especially any Flag or Pennant breakouts. Now we look at the bigger picture again, the Daily in this case, which I have already been posting above. Because I am not sure if we have seen the top of the move on the Weekly Chart, the wide channel is not broken so a trend reversal has not been confirmed and there was no significant NMD (aprt of my criteria set), I cannot rule out a higher high and the Weekly/Monthly chart Fib 50% is a likely candidate for the completion of the rally in my view. If the trend has indeed changed then I would expect a Daily chart EW 1-2 retrace with the wave 1 being the current move down. Therefore I am looking at likely support turning points and waiting for price action to confirm one of these (or some other, it is not a perfect science or anything, nor a black art...). had I traded shorts I would be using TA to identify when to exit, based on my Long criteria and might swing trade this one as the move down leaves plenty of headroom above for a retrace to say Fib 62%. I would then look for a breakout of the down sloping channel to confirm a rally BUT watch as retests of any breakout are treacherous and if it is a retrace the wave B can be ruthless, as we may have seen on EURUSD recently for instance. Net I have 2 scenario road maps in play: Fresh higher high to conclude the rally at circa the Monthly Fib 50% Tops in already and EW1-2 retrace to good resistance then big move down in wave 3 The reason I would not Short now is that I expect a significant retrace, which will offer a much better entry. I place Stops at strategic positions on my road map and only use a % rule as money management not to set stops, why would the market obey a set percentage? That is a measure of what one is willing to lose not where price actions is suggesting a change in direction. I Hope this helps but feel free to ask any follow questions you may have on Oil (if you want to continue a discussion about trading methods I suggest we open a new thread and keep this one about Oil.)

Thanks for that @TrendFollower but in essence you are agreeing with both of us because, as I have said many times, I am not predicting the future nor issuing a forecast. I am merely laying out scenario road maps that, if the market follows them, offer opportunities to do as you suggest, which is to identify lower risk (or higher probability of success if you prefer) trades. I also use the road maps to manage my trades in flight and to swing effectively along the EW waves. I do take issue with one thing you say, but am not trying to convert you or anything, and that is that market history doesn't repeat itself. The fact that in many markets there is a recognisible form to rallies and retraces; that Fibonacci retraces work, that supply/demand levels are retested and hold or are broken is all about patterns repeating. The fact that this happens across many types of asset classes, (even bitcoin...), is telling for me. To paraphrase @Caseynotes, with extensive study and practice one can use this to advantage. You have heard the phrase, "markets have memories"? The memory is the pattern repeating. Why would it happen? Because humans are emotional beings not logical beings and herding is a real phenomena, along with group think, confirmation bias etc etc. Humans are also evolved for pattern recognition, it is how we have become top of the food chain despite being much weaker than other animals. Well structured technical analysis seeks to identify the group psychological dynamic to decipher and take advantage of this human nature. It is all about sentiment, as I have also said before, and that is driven by the balance of greed and fear. This is why we see markets grind inexorably up in bull runs and crash much faster in bear runs (Fear is stronger than Greed in the end). Regarding your method etc, I am only really seeking to understand you thinking on the Oil Short idea rather than your whole method, although I will check out the thread you suggest. If you feel like it I would welcome a bit more detail on what you are thinking, or have already done on an Oil short. Then I may be able to add some value (and get some in return or course)

Ok thanks for that @Caseynotes. Our time-frames and methods are different but essentially we are doing the same thing, just using different rules and triggers. Where as you are using Wykcoff I am using charting and Elliot waves plus both of us are using price action, albeit slightly different ones. I only use fundamentals at macro levels and you use news and data real time, so we will always be at odds over this but I do not say that this is wrong for your time-frame, just that it is not useful for mind (agree to differ). I do agree that TA alone, or any single method alone, is not particularly useful. I do agree with Buffett et al on forecasting and sticking religiously to that in the face of contrary price action evidence. I have a set methodology to identify trading opportunities and a set of criteria that much be in place. Some of this is delivered by TA but all of it require price action confirmation to trigger a trade. The one thing I do do, that may not sit well with you is lay out scenarios (that appear to be forecasts but I call them road maps because I am most definitely not saying they will happen). If the market starts following a road map I am more confident I can get in and manage the trade for maximum profit and to aid swing trading. This is a vital component for me as I do not day trade. Coming back to Oil tho... (and happy to resume engagement on methods elsewhere, all very interesting.). Looking at the 1 hour the market is showing some consol at my first support level, right on the line actually. Watching this now to see if the turn happens or it slips down to the next one.

So the market did indeed run up to pre identified resistance and bounced back down, not as hard as the EURO though. Does this mean there is movement on Brexit? Who care? Technical analysis and price action told the tale, all I needed to do was be ready to take advantage or my road map if proved reliable: Good resistance level on the 1 hour chart NMD on the turning point Nice simple 1-5 wave patter completed on the turn Low risk entry with stops just above the Resistance zone Additionally the turn was off the underside of the Fib 62% level from the Oct 12 (wave B) high (not drawn on chart) I exited by Long from the Triangle breakout and entered a Short at the turning point, now stop protected just above the turn (very small loss if it reverses - retrace moves can be tricky). I am expecting this market to retest suitable support levels, maybe even the original Triangle breakout level before a strong rally away. I am now looking to identify the next turn up to exit my Shorts and resume my Longs campaign. If the market hammers on through to resume the Bearish trend I have some good shorts, stop protected at break-even.

Ok @Caseynotes, I think I get that and thanks for sharing. Not trying to pick it apart here, as we agree it is all horses for courses and I don't trade at these time-frames so have no opinion as such. Just for understanding then, what I think I'm seeing here is you identifying a bounce (price action if you will) off a support/resistance level and supported by the LWMA (which is a technical indicator), and perhaps using related news or other dynamics off chart, you go long. I assume you have rules for where you can put stops credible and as you said you have to have a few things come together to place the trade. Then in terms of trade management you look out for possible reversals of the original set up premise (the reason you took a trade in the first place) and make a determination as to whether to stay in and give it more time or cut and run. Roughly correct?

Ah so what is your definition of price action @Caseynotes and what constitutes a trigger for you to trade? There must be some "science" to it otherwise how can a newbie learn, on simulator or otherwise, where would they start? What would they look for? What time-frames to look at? How to decide which way the market is going from the price action? What are the price action signals? When is the signal confirmed and a trade is on? Etc Etc.

Yeah but what them do you mean by learning to trade? I'm not clear on what you are saying, except you seem to be disassociating analysis from trading whereas analysis is a critical part of my trading.

Ah yes but that's the trick isn't? @Caseynotes The ability to execute on a probability that is better than 50/50 or worse (gambling). We all use some form of technical analysis to try to figure out good entries and good stop placement right? Even if it is just trading between levels. Otherwise we are trading on a "feeling". I am interested to hear @TrendFollowertrading assessment of his Short idea to see how he does it, always keen to see other approaches. We also all use some form of Fundamentals too right? The difference comes in how. Day traders, I assume, hang on every data release to watch short term resultant moves. Long term traders ignore this in the main (except for big ones that coincide with major turning points) and look at the bigger picture Fundamentals. Which is right, which is wrong? Both and neither perhaps, I'm really not smart enough to really know what moves the market. As I have always said, you need to know what type of trader you are talking to and how they trade to get what they might be saying. And does it matter what moves the market so long as we recognise it and capitalise? I think the bias point is the most important one here perhaps. We all have them. What I try to do to offset that is come up with several scenarios and set out likely road maps based on historic price action, which may often be in opposition to each other, especially at major support/resistance points. But I only actually trade when the price action follows one path and then use key breakout points to trigger a trade. Stops will then be places fairly close below/above the breakout points (using a sensible prior low if possible and a maximum allowable loss equation rule). As a longer term trader my intention is to hit a sizable gain (fewer bigger better) and scratch anything that reverses against my road map fast to only lose small (or not at all if I can move to break-even). A wise man once said, "If I had cut my losses faster over my entire career I would be much richer now". He was a long term trader too. In my experience my biggest losses were as a result of not scratching a reversal fast enough but holding on, convinced by my own analysis. I don't do that anymore and am much better off for it. Ultimately I believe we are saying the same thing. Let the market price action be your guide, we only different on time frame and method but it would be boring and dangerous if we were all doing the same thing right? Too much like herd beast and we know what happens to sheep and goats, they get annihilated by the bulls and bears... Happy NFP day!

Fully agree with that @Caseynotes, I have no interest in professional analysts utterances, as I think I posted recently the notion of projecting where the market would "end the year" is fallacious and I also said something similar to the above as to why they do it. WB & Co don't do it right? At most they tell their clients what their strategy is but they don't write articles about what the market is going to do and why it is doing what it is doing is my point. When journos write articles they are doing exactly what WB an CM are talking about and rejecting, is also my point. But hey it is just an opinion, nice that someone like WB shares it though.

Silver has returned to the upper Triangle line of the current consol period. A break out here and of overhead resistance would be very bullish but a rebound off the Triangle suggests a return to the lower line (as described by the support zone around 1415. The 1 hour chart pin bar isn't that compelling just yet, could easily see a test of overhead resistance, which if it holds would establish a trading range. Breakouts from long term trading ranges are very compelling. One to watch. Also, as the saying goes, "as goes silver so goes gold". On my Gold 4 hour chart I have been tracking the retrace back towards 1,200. The turn at Fib 50% was compelling but I couldn't rule out a clearer A-B-C formation and so far that is on the cards with a potential turn at Fib78% of the rally retrace on a pin bar. If the current move up is a 1-2 then the next leg will be hard down towards the Fib 62% (Triangle breakout zone retest - 1,206) or the Daily Triangle breakout zone of 1,200 exact. I prefer the latter set up t present.

Gain traction @TrendFollower (pun intended?) ?. Re the articles, the press will always find ways to write an interesting story but frankly if there really had superior insights they would be Warren Buffett and not some relatively unknown journo. WB doesn't make pronouncements like that he just quietly gets on with his business. Now if he did start publishing I would listen nut I don't listen to the MSM, except maybe to identify euphoria before a reversal... (classic contrarian in me). Also, as we both agree, I let the price action be my guide and I don't really need to know why something moved in the past day, hour, minute. It's just not relevant to me and TMI kills analysts as they chase shadows and wonder why the market went up and not down on poor NFP (or whatever) rather than working out what the price action means for their overall assessment. OK so much for all that, now on to the more pertinent question, to Short or not to Short. Actually it is a great topic as it is likely to through up a different in our methods, which is always worth exploring. I love to hear about how others decide on a trade entry, risk management, stop placement etc (you and I have engaged a little on this in our posts before). So let me ask you to lay out for me how you would trade a Short on Oil as follows: logic for the Short (i.e. direction), mostly you have done that already but a few quick summary points please? Where to enter Where to place stops Likely exit point and total pointage target and how long you feel it may take to achieve this With this I can then tell you how I see it. Probably we will be aligned on direction but differ on trading method. This will be an interesting exercise perhaps.

Interesting upper channel line @elle (the top dotted one). I am still waiting for a retrace before this rally really gets going. What is interesting is that a retrace to the breakout zone of my Triangle zone could also retrace to your channel line... Depending on where this run tops out, that could also be setting up a Fib 50% hit, will be interesting to see how today progress with NFP data. Whatever happens today I am minded to declare that the move up from the key support zones (across most stock indices) is a bullish move for the present.

Are you suggesting the markets are taking no notice of my charts? Surely not... ?

HGC remains in a Flag consolidation formation after a fake breakout down was pushed back inside the Flag (very bullish in this case). We could see another fall towards NFP tomorrow and if we see a rally on up and through the upper line this will, I think, support a stocks rally and USD fall.

Well notwithstanding Twitter utterances (and maybe they are relevant for intra-day trading, I grant you that), it looks to me like the Dow (and other majors) rallied on up to a resistance level and then bounced back down. As mentioned earlier, I think we will see a retrace ahead of tomorrows NFP and there are a couple of support zone candidates for a retrace move to complete. Of note the rally up is in a classic 1-5 wave pattern, I am expecting an A-B-C retrace and turn at support to kick start a much longer rally phase. To prime the pump for a significant rally we need to have a retrace now. USDJPY is following a similar pattern, with a similar breakout point to be retested.

On the contrary @TrendFollower, my chart set ups are showing that the medium to long term outlook is for a Bear market. As you have said yourself, markets do not move in straight lines and I agree so I am expecting a rally soon to set up the Bear. I am simply unsure as to whether this will be a partial retrace of the current move down or a full leg up to a fresh high. I would need to see this rally before contemplating a Short. Additionally, in response to the original question on the thread, I suggested at the time things were unclear to me and therefore no trade presented itself. However if we see a turn at support and a break of the upper channel then a Long is viable but only short term. In terms of the macro picture I also present 2 LT scenarios: Oil drops to all time lows as its importance dwindles Oil sky rockets a "peak oil" becomes a reality I think the Oil market is a lot more complex that a simple supply and demand equation and I do not think the American President has the power or influence to do much about it. Anyway for me, as a technical analyst, I don't much care either way, I let the price action do the talking.

Don't buy that sorry! If that is all it took to move the market then the whole thing is totally @&*%$)

Brent not there yet, patience required still on Oil.

4 hour chart might be a bit easier to read and is suggesting the 13,000 mark is about right for a top out level. The retest of the Triangle breakout zone would also be at Fib 62% IF 13,000 is is top top out. let's see.

Now we have had a firm breakout of the 4 hour chart (and Daily) Triangle formation at a credible Wave B (sigh of relief!) I am looking to target my first swing trade. I expect GBP in particular to swing back down fairly hard and probably to retest the Triangle breakout zone or even lower perhaps. NFP may come into play to halt and turn the retrace into a strong wave 3 rally. I do not expect EUR to retrace as hard but let's wait and see. I think AUD will only retrace at most to the Daily channel line, this one is already in a wave 3 of Wave A. I see 2 wave 1 top out candidates very close to each other (red level zones on chart below). I like the second because a hit on the underside of an opposite trend Fib is always interesting but the supply/demand zones on the first one are also interesting. Trading strategy: Hold pre Triangle breakout Longs but sell post Longs at the first resistance zone (next one isn't that much further after all Do not Short, the risk reward is not there Wait for a good retrace to a strong turn zone, watching out for NFP tomorrow and then go Long again, leveraging profits from firs swing Thoughts?

AUDUSD breakout of the Daily channel is looking good and signs are therefore also favourable that other USD pairs will follow. In terms of the analysis, on my Daily & 4 hour chart I have a wave 1 (blue) end and turn just inside my support zone (green lines from the Daily Chart) with a rally away in 2 sets of 1-2 retraces before a strong wave 3 push up to and (at present through) the channel upper line. I would need to see a daily chart candle close above the line for confirmation but on the strength of the move and the EW set up and the fact that there is good PMD at Wave 1 on both charts I am feeling confident. May still get a short term retest of the Channel but I don't see a hard retest or failure as a high probability. Oscillators are also heading in the right direction on the Daily and I would not expect a significant retrace back down until one or both of these are in over bought territory. At present I am expecting that eventuality to trigger the Wave A completion and retrace in wave B before the final rally on up. Trading strategy: I'm not trading this myself, preferring other markets The best trading Long entry was on one of the 1-2 retraces, or a speculative on the reemergence out of Support zone. If you have missed that or want to pyramid this one I would be looking to only trade retraces, maybe a retest on the channel line could work. However if I took a Long now I would exit at the Wave A completion and wait for Wave B to complete and turn before getting in Long again.

This raises an important point in charting @cryptotrader, which is that one can draw lines in many places at once. In fact for me it is important to try several set ups to find the best one or identify alternative scenarios. For both analytical conclusions and especially for actual trading off the chart set ups I find I need much more that just lines or geometric patterns. I use a variety of other techniques and try to stick to set rules for what needs to be in place before actually trading. I believe @elle uses at least diagonal lines/channels and levels, maybe other stuff not shown, and where you get an intersection of a strong level and a channel tram-line that is typically an important zone of support/resistance for me. However in this case I disagree with both channel scenarios, I don't see a Daily chart up-sloping channel I find credible on Brent right now. I have a much wider channel on the Weekly chart, which I think is the key driver in play on oil. On the Daily I have a down-sloping channel (red lines), which I am interesting in seeing how it interacts with key support zone...