I’ve got a new toy called Spotify.  It’s alot like iTunes but everything is rented (free) and you don’t own it.  But so long as you’re OK with that, the playlists are endless.  Kind of cool and having fun listening to stuff I’ve never heard or haven’t heard in a long, long time.

I never realized how great “Rumours” by Fleetwood Mac was.  Just solid all the way through and worth a listen if you’ve never heard it.  Stevie Nicks was IT back then too.  Anyway…..

When last I wrote, I was looking for a simple pullback in Gold in order to grab a bargain and watch the flight take place from 1,600 or so.  Nice try.  It never let me in and I am now looking at this thing as I did Silver back in May.  Parabolic “fear” trade that has the potential for causing some pain.

So, in full disclosure I have exited all GDXJ positions at this time and will wait this out.  We are battling the 74.40 area in the dollar, and it’s looking like if there is to be a new low in the dollar, it’s going to have to have a catalyst (QE3 anyone?).  But for now this consolidation area is going to have to break one way or another, and based on what we are seeing in stocks, dollar strength looks to be in the cards at least in the short term.

As for equities – S&P’s specifically – it’s now looking like the bear is BACK!  With today’s move below the March low, we need to be aware that the path of least resistance is quite possibly lower.

I’ve drawn a trend line (yellow) from the March lows to the June lows and beyond.  It is my expectation that we now rally for a day or two to work off the oversold condition and to get bulls feeling good again – and then the fun will start.  1,270 is a first level of resistance, followed by 1,280 and finally 1,300.  Any of these points could act as a ceiling for this move, which makes sense as they will also match up with some key Fib areas too.

Interesting how the low today literally tapped the S2 for the month, eh?  If you are long equities right now, use the bounce to lighten up.  Can we bust higher still?  Sure.  But the break of the March lows makes me think there’s unfinished business below there – possibly to 1,150.

The catalysts are still unknown, but trade the facts and what you see, not what Rumours you hear or who’s crazy ideas seem to make sense on any given day.  The world is coming to grips with debt and currency crises, and there are surely more problems to be unearthed before this is all over.

Trade ’em well and trade the extremes – always!

Now an oldie but goodie, and pure FleetwoodMac…..


About thefront9

Independent trader with a flexible approach to the markets. Position trading, swing trading and day trading using Futures, Equities and Options. This site is intended to help others (and myself) see what I see and to stay true to the discipline of making trades at the extremes. Contrarian and TastyTrade addict! Living in Texas with my family, helping others and maybe playing some golf from time to time makes life busy and great. Add a little music and humor and that just about sums it up. Trade the extremes and manage risk.....always!
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