BUNKER TRADING

                                          How I Start The Day

Any chimp can throw money at a trade. It’s what happens after you click the button that matters.

To say that trading has been tough these last weeks is a huge understatement. One thing that should never waver is your commitment to proper risk management.

When conditions manifest themselves into this hyperbolic mess you need to do 2 things: 1) reduce your trading size and volume, and 2) pick your spots and be very, very quick on the trigger.

First Crude.

Crude finally got its range today [200 ticks], thanks to painting-the-tape on both the high and low. Take these phantom BS ticks away and you have about a 140 tick range. Fifth day in a row this market has been a joke.

Now Gold.

Insane trading; what else can I say?

I wouldn’t be surprised if tomorrows range was $150 or $15.

If you strictly followed the algorithm today, it would have been a disaster. Why? Because the market is moving too fast for the algorithm.

While it is very good at giving entry signals in almost all market conditions, liquidation in fast markets will always be a problem. I picked my spot today and incrementally gained by being long. Money is money and in this environment of gold moving $0 - $50 within seconds, I simply cannot wait for the algo to give me an “official” liquidation signal.

Because of the way dealers make the market, your only hope in getting a decent fill is to sell when gold is moving higher and buy when it is moving lower. Even then, you can still see them play games with the spread.

But if you sell as it turns over and starts going down, may the force be with you.

Finally, are conditions right for the “Lemmings in Asia” [LIA] to capitulate and throw in the towel, and finally sell gold in the Asian session? A nice $15 - $30 drop near the open would do wonders for bullish sentiment and probably get the European and U.S. sessions propelling higher. [Not predicting, just some thoughts, although …..]

Have a good day everyone.

-vegas