REFLECTIONS

                                Always Wear Your Safety Helmet

A frustrating day, month, and quarter in about that order. Gold is going nowhere; up a little, down a little, back to the middle after stops on both sides get taken out. Today a perfect metaphor for the quarter; a “paint the tape” $11 daily range.

The FWD showed up again today, and even the adjustments I have made to the algorithm couldn’t prevent a small loss. Very small ranges and moves to both ends will most likely result in a trading loss. Sometimes I am able to sidestep it and sometimes I can’t; today was a “can’t”.

Meanwhile in crude oil.

“Oyyyyy.”

Nice $1.25 / bll. drop in 30 minutes to end the week hey? This market right now is even more messed up than gold. And even with the drop, the day’s range is still only $1.36; heck, it was only $1.11 until the drop.

When crude was trading between $70 - $95 / bll [2009 – 2011] it had trading ranges averaging 287 ticks per day. Now, even with news, we can’t get but maybe 235. Most of the last month has been sub 200. Are the central planners at the Fed now in oil as well? God help us.

Going forward, if we can get rid of the “Flying Wedge of Death” things will look much more profitable. We have to be vulnerable to something, and the FWD is a very low probability event. That doesn’t mean you can’t have them 5 out of the next 6 days; what it does mean is that they are infrequent at best.

Have a good weekend everyone.

-vegas