NO GOOD OPTIONS

                                             Well, Not Here

This is the kind of day that presents no good options for a trade. We have cross-currents all over the place and add to that it’s Friday, and you have markets that are everywhere and nowhere at the same time.

First Crude.

Yesterday’s final hour blow-off [a Saudi oil pipeline blew up] of 200 ticks to 110.50, subsequently followed by 200 ticks down did a lot of technical damage. It basically took today’s weekend short covering and made it show its hand yesterday, thereby robbing today of buying demand.

From today’s first hour of light buying, it was straight down. Again today, I bought crude after the range was put in at the 106.05 low [295 ticks]: I was too early. Although I got out with a few pennies profit before it went even lower to its day low of 105.79, until the final low was put in it was very difficult for the market to stay on the bid.

After the final low, it was pure fireworks; up 50 ticks in 4 minutes with another 70 ticks in the next 50 minutes before selling off 50 ticks in 6 minutes. With the algorithm on the buy side, the window of opportunity today for profits was very, very tight.

It very much looks like the market can fill the 103.88 gap on the daily candlestick charts next week. From where the market is as I write this, it’s only about 240 ticks away. If gold can test its lows from this week, crude has a shot to fill the gap. This would not only fill the gap, but it’s about half way back from the start of the rally. A break of 102.50 and I would question the sustainability of the bull run for the near term.

Crude offers many opportunities, but you have to be selective in how you trade it. Every day this week, the algorithm was in “buy node”, yet every day this week except Wednesday, the market broke down rather viciously, setting off sell stops in the process.

As I state in the manual for trading crude, play the range and watch out for reversal days. Pick your spots using the algorithm.

On Wednesday, we had the rather unique event of gold being down over $100 / oz., and crude rallying $2 / barrel very late in the afternoon after most traders had departed [including me].

Yesterday’s $2/ barrel rally after 2 PM on the Saudi oil pipeline blow-up was the only other rally of significance for the week.

So, considering this is it any wonder why my volume in crude was so low while I was buying all week? Well, it shouldn’t be because you all know my first priority is to stay out of trouble. Granted, the money I made wasn’t much each day in crude, but it was probably the worst week in memory for trying to be long each and every day.

Now Gold.

The the other shoe  is gonna drop.

Maybe we just test the lows at the 1700 – 1685 area, or maybe the next Asian hedge fund blows its metaphorical brains out by giving JPM a market order to sell 30 metric tones of gold at the market. I dunno, we’ll see.

While the algorithm is in “buy mode”, given what happened this week on Wednesday, I have to see a minimum of the test of the lows before I buy gold off the algorithm. I’m not going to expose myself to “the other shoe” on a Friday unless I see this, and we didn’t see it today. That’s why I never tried to position myself in gold today.

If we could have gotten down to 1695 – 1699 area, followed by a very quick bounce back over 1700, I would have made the trade to be long.

Going forward, I don’t think we’ll see the lows in gold until Asia sells it off. They buy gold practically every single night, and until we see them capitulate in some way, we can’t get the reversal off this low that the market needs to go higher in the European and U.S. sessions. We’ll see what happens next week.

Have a great weekend everyone.

-vegas

MICRO SECOND TRADING

                            The World Can Be Crazy Sometimes

 “Oyyyyyyy”.

Somehow, someway, they almost always get the range in.

Play the range and be careful of reversal days.

I started the day in Asia trying to position trade a very small short position in gold. Of course, after a $100+ / oz. drop, I should have known from the bottom we were going to get a straight $40/ oz. rally. What was I thinkin’?

Meanwhile in crude.

Don’t look for me to be able to “explain” the action in crude oil. I refer, of course, not to the 22 hours it was open, but what happened from 2 PM to about 2:40 PM. Crude did almost nothing but rally 4, break 3, all night and day long. Then at 2 PM [Chicago time], in 23 minutes we double the range from 200 to 400 with a 200 tick rally; followed by a 100 tick break in 6 minutes; followed by a 50 tick rally in 17 minutes; and then the obligatory account destruction move of 90 ticks down in 2 minutes. And you wonder why I said in the manual not to initiate new positions after 2 PM?

But wait, it’s not finished just yet. We got another drop of 50 ticks in 1 minute at 2:58 PM just to put some icing on the cake.

“Ok, now that we killed your account, let’s go home!”

For most of the day I was bullish, but found it extremely difficult getting in at a decent price. As I said, it was “a new high by 5 ticks, and then a vicious break of 30 ticks” all day long. The market would correct, and then in a literal blink of your eyes, it was up 30 or 40 ticks. Well, now what?

Welcome to micro second trading.

Although I made money in crude today, it wasn’t enough to cover what I lost trying to position trade a short gold position. So, I lost a couple hundred bucks today. I’ll be at it again starting tonight.

Have a good day everyone.

-vegas

WHEN MARKETS GO POSTAL

                                 Well, As A Matter Of Fact I Do

I like volatility; I even like above normal volatility; but “postal” volatility? Errrrr, no thanks.

Because they are tangentially related, I can promise you that anytime gold moves $90 - $100 / oz. within an hour, crude is going to sit up and take notice. Today was one of those days.

Sure, plenty of chances for profit; many more chances to get destroyed. I had a scratch trade today, one that was profitable but quickly came back and took my “free trade” out. Then gold broke about $50 / oz. in a matter of a minute. Crude quickly followed.

When you get these waterfalls, it is impossible to know or have any confidence in support levels. Sure, I wanted to buy below 105.50, but with gold down $90 / oz., am I supposed to infer crude has a big rally in it? Chances are it won’t; that doesn’t mean it can’t [and it did].

For the 3^rd day in a row, the market has experienced these lower stop hunts, and if you look at an hourly candlestick you will instantly know what I mean. I don’t have a problem with this kind of action, but when I see gold go $50 / oz. lower in a minute, there isn’t any way I want to be long crude at the same time.

So, what to do? Easy; walk away and come back later. This is probably the hardest thing a non professional trader faces. It sounds easy; it isn’t. but I do know one thing; there are a whole lot of people who wish they had only a scratch trade today. A whole lot.

My first priority is to stay out of trouble; then we make money.

I’m hoping we can get the 1700 level taken out in gold so that crude can trade higher tomorrow. If it does, I’ll be there.

Have a good day everyone.

-vegas

P.S. As I post, gold has broken 1700. I guess they couldn’t wait until tonight.

CRUDE MISBEHAVING

                                   The Key To Wealth Creation

About the only things I didn’t have to deal with today were famine, pestilence, and locusts. Just about everything else took its best shot at me. But enough of me.

Two things about crude oil that has to be reinforced to you in a big way: 1) play the range of volatility, and 2) beware the reversal days.

We had a double reversal today in crude, with an early low followed by the day’s high, and then a sharp sell-off into the day’s low in mid afternoon trading. Like I said yesterday, somehow, someway the range gets put in; not always is it obvious from earlier in the day.

Like yesterday, we had a small break near the open. With only a 100 point range, it was the second break I was looking for on a buy signal from the algorithm. “Sorry vegas, no can do!”

As we went to the highs, I finally got long, and at that point I liked the markets chances of going even higher. The market immediately went on a 14 minute 50 cent sell-off that did some technical damage to my prevailing bullish attitude. At this point I knew I had one chance to get out at a profit, if in fact the high had been put in at 108.69.

When the market rallied up to challenge the high, it had to go through like a hot knife through butter. It didn’t. It got as high as 108.64 [bid], but the very next tick was 108.61 and I was out. A few hours of mindless chop, and the sell-off picked up steam as we broke through 107.75.

It really comes as no surprise that after a huge run in the last 15 days, we get some long liquidation from position players. Trees don’t grow to the sky. You should notice though, that these sell-offs really have no power beyond a few minutes. Yesterday’s $1.25 / barrel sell-off lasted 23 minutes; today’s was about 28 minutes for about a $1.50 / barrel. In other words, there really isn’t any sustained selling; it’s all stops. That could change of course, but for now once the stops are out of the way the market drifts higher.

My experience tells me we can’t go higher until we get lower prices in Europe, followed by an early low in the U.S., and then some kind of power move up. The 31.8% fib retracement, of the 3 week rally, comes in at about 105.60. Keep your eye out for that level as good support.

As I stated over on my other post, “Weimar Ben” is in front of Congress tomorrow. There could be fireworks if he makes it clear more easing [and printing of money] is on the way.

Until then, stay disciplined.

Have a good day everyone.

-vegas

PUTTING IN THE DAY’S RANGE

                                 Long Crude In The Final Hour

Gold? Ahhhh, a waste of time right now.

On to crude!

We started the day having been up 13 out of the last 14 days, and 10 days in a row. From the lows 14 days ago, crude oil is up approximately $14 / barrel. So, I’m starting the day somewhat cautious because I know at some point the tsunami of profit taking is going to come in and cause some disruptions.

The million dollar question is when; early or late? As I stated over on my other post, in bull markets, early breaks can be bought, late breaks can’t.

We got our first good buy signal from “Vegas Crude Oil Trader” at about 108.54 off the 108.24 low early in the morning. With the high being put in much earlier in Asia at 109.68, the range was then 144. I didn’t take this trade because I wanted the second break at a higher range. “Sorry vegas, no can do!”

In a volatile market like crude, which is volatile to say the least, I am always mindful of the range for the day. It is a major component of my decision to buy/sell.

By late morning, crude had rallied up past 109.00, and was looking like it wanted to make a new high. The key here on a range of 144 is whether or not the market can retrace past the fib ratio of 0.618% off the low. That would be 89 off the low, so you are looking at a very pivotal point of 109.13 [bid]. If it can penetrate that level, the market has a shot of hitting a new high.

I bought at 109.18. I went with a low volume because I wanted the flexibility to add to the position if it was the correct one and we were in fact going to hit a new high. I want all my trades to become “free trades” and allow them to “run”.

The market bolted through the 109.20 level and spent a minute or two above 109.20 before going 109.26 bid. At that point, the market’s next price was 109.21 bid, a drop of 5 ticks. I knew at this instant, the breakthrough through the fib ratio level was a trap. I exited the trade for a few pennies of profit at 109.21.

The very next 1 minute candlestick and the market started lower in earnest.

Now, the question is; when does the low get put in and how deep? If it can come in early afternoon, there is a chance of a good bounce back. If it comes late look out below.

“How does a $1.25 / barrel break in 23 minutes in the last hour of trading sound?”

So, there you go, the range is $2.43 for the day. Like I said, somehow, someway it happens. If it had been on the upside, I would have hit it. Tomorrows another day.

Up on the right hand side of the website are the download links for “Vegas Crude Oil Trader”. It’s totally free folks, what else do you want from me?

Have a good day everyone.

-vegas

SPECIAL POST: vegas Delivers As Adverised

                                 She’s Screamin’ Her Lungs Out

As promised on Friday, the links to download “Vegas Crude Oil Trader” ARE UP ON THE WEBSITE. There are 3 links and you need to download each one. The links are located in the upper right hand corner of the website under “DOWNLOAD THE “VEGAS CRUDE OIL TRADER” FILES.

                                                                                              

“Vegas Crude Oil Trader” is a 64 pages PDF manual that has everything you need to get up and running.

The “Vegas Crude Oil Trader” mq4 file and the “Vegas 1HR Crude Oil trader” mq4 file are files that need to be installed into the MT4 trading platform. The algorithm is super-imposed over the appropriate charts and is visual in nature. See Appendix II of the manual for easy and detailed installation instructions.

If you ever wanted to trade crude oil, here is your opportunity.

If you have any questions or need help drop me an email at vegasxau@ymail.com and I’ll try and get back with you ASAP. Enjoy.

Have a good day everyone.

-vegas