What Happens To Gold And Silver Next? Look Out Below?

This is one of my favorite threads on the internet! It's very informative and educational, although I find myself trying to understand some of the concepts.

I'm just glad that I made the simple decision last summer to buy gold and silver. I could sell right now and make a decent profit off of my 15 ounces of gold. I'm not selling though, I will sell half of my stash at 1400 or so.

Wow, you weren't kidding about a violent pullback, Yup!

And so quick too... silver dropped to nearly $19.50... it felt like we were falling off a cliff...

Is this the kind of pullback behavior we can expect for the next while?

IMO

Floor traders were just cleaning out the "STOPS"

Holidays are natoreuos thin markets

Its more than markets go up and down. More to the point, markets have price levels and patterns where the likelihood of a pull back or run up happen.

Commodities are notorious for having these wild moves, even if they are trending. Domain555 makes the point that I know from experience that yes, holiday trading is veryyyyy thin and so moves are going to really be pronounced and exaggerated in the Futures market, especially overnight.

Again, I wouldnt really read too much into other markets moves and not too much into our overnight sessions, especially if you have a shorter time frame. There are traders who are just enjoying these wild moves as we speak.


I do think the ride in PMs, despite being in an uptrend, will be bumpy, which I have said since the start. Again, LOTS of overhead resistance, sellers will step in, remember "price has memory".

@AgcoinAu

Favorite books- I only have 6 books in my entire library. 3 I read over and over. 4 of them are about Livermore.

How To Trade In Stocks by Jesse Livermore is a must book, I have mentioned it here many times. He was one of the earliest traders to publish his work and share it, and this book is required reading by trading desks all over the world. No matter if it is a large or small firm or independent traders, this book is read and in everyone's library so to speak.

Reminiscences of a Stock Operator by Edwin Levfevre, a book based on Livermore's experiences, written while Jesse was a live.

Technical Analysis of Stock Trends Edwards Maggee Bassettti, very ollllld book, getting its start in 1893 but is updated, charts included are from the 1920s, 1930s, 1940s, etc.. up to now. They issue new editions every few years but only with some updated preface, a few charts from this decade, etc. Why have they continued with the same charts from DECADES ago?

Because price patterns and trends have NOT changed since the day markets opened. As they say, there is NOTHING new in markets, it has all happened before and this book does a great job of putting it that in perspective. Very technical in nature but if you can grasp price action and trends, this will help you understand the patterns that play out.

What I learned Losing a Million Dollars- Jim Paul and Brendan Moynihan

A Modern Day account of a trader who thinks he knows what he is doing, has tons and tons of money, thinks he knows best and then the worst things happen, all along he fights the market. Eventually, all the losing and loses add up and help him see what he is doing. You will enjoy reading this book which also emphasizes how having rules,discipline, including a game plan, that you consistently stick too, will help you avoid ruination in markets and helps you accept that losses are good, that they help limit risk.


Outside of that, I really dont read many books about trading or investing as I have found my edge in the markets and refined it over the years, which by now should be abundantly clear, which is trend following. That is not to say there aren't other great books out there but I prefer to limit what I read, keep it simple, stick to what works for me and refine always the edge I have, in trading you still are always learning, refining, improving, finding ways to extract more profit or lessen risk in the markets.

Thanks yup. Going to wait on a pull back and consolidation as you said. In the meantime have bought and downloaded 'Reminiscences of a Stock Operator by Edwin Levfevre' to read so I can try and purge emotions from my trading.

@zack

yea just hang in there. I know a lot of traders who have already sold and moved on from gold and silver and now are awaiting for a proper entry to get back into gold and silver.

The beauty of a trend is it continues on and at a certain point, it does allow you a proper entry. All that is needed is patience and discipline.

I realize the first inclination among humans, when seeing something get away from them is, "heyyy if I dont grab it now, I am going to miss all of it." But remember what even Livermore said " No stock (asset) is too high to buy and no stock (asset) is too low to sell."

... and I will tell you this too, SOMETIMES, at the very end of a trend, when folks have missed the entire move thats been happening for a while now (and no, I am not referring to gold and silver) they jump at any chance to get in, not realizing that the asset has already run its course going higher.

But let's go back to silver and gold. Sooner or later there will be a good reset where prices stop making yearly highs, dive lower OR go into a consolidation mode. We have seen the PMs do this already this year so far. It will happen again. The market works in cycles. As an example, right now many defensive type assets are working and going higher and have been for MONTHS even before all this silly noise with the UK vote.

As an example, did you know that BEFORE the UK voted to get out of the EU, the US long bond was already making moves into yearly highs? Were you aware that utility stocks have been grinding higher for MONTHS and MONTHS before Brexit? Were you aware that the japanese Yen has been on the defensive also, making yearly highs?

In between these moves, all these defensive sectors nose dived and did nothing for 1-2 months before containing their uptrends. Why did this happen? For a time period, the market rotated out of these sectors into other sectors and then came back to these defensive assets.

In time, we will see some sort of rotation where the miners take a break, gold, silver, and other defensive assets before starting up again. Somewhere around there will provide a chance to get back in.

Buuurp! Who's buying today