Entries by Peter Brandt

Impressive Precious Metals

Impressive Precious Metals

The advance in the precious metals markets has been impressive. It is remarkable that the advances in Gold and Silver have not been accompanied by aggressive commercial selling. In fact, the net commercial short position in Gold is little changed from the Dec 2016 low – meaning that commercials have NOT sold into the advance. A similar profile exits in Silver. Speculators have a COT profile in both Silver and Gold that suggests a sizable war chest for buying.

I just have one major problem with the Gold market (and to a lesser degree with Silver). Historically there have been recognizable chart patterns marking major highs and lows in Gold. Gold seldom makes a major trend change without “ringing a bell” with classical chart construction. Gold did not display a chart bottom at the Dec 2016 low. Nor does Gold presently display a recognizable continuation pattern. Some chartist consider the trendline connecting the Sep 2011, Oct 2012, Jul 2016, Apr 2017 and Jun 2017 highs to be important – I am not among such chartist. I hold down trendlines in very low technical regard.

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How much patience should a trader have with a losing trade?

How much patience should a trader have with a losing trade?

 

The question on losing trades, all traders must answer for themselves, and there really is no right answer. The answer for any given trader must depend upon his or her trading approach, markets traded, risk tolerance and other factors.

For me, the answer to this question is quite simple and multi-layered.

  • My initial risk per trade seldom exceeds 70 basis points and is limited to 100 basis
  • I aggressively advance protective stops within days (sometimes hours) after entering a trade.
  • My goal is to bring a trade to as close to breakeven as possible, as quickly as possible!

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