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Late Week Update on
Precious Metals & Oil
by Chris Vermeulen
Over the past two weeks the broad
market has been inching its way higher. The recent intraday volatility indicates
bull and bears are both trying to take control. Money flows in one hour and out
the next. This is not the greatest price action for swing traders, but day
traders love these powerful intraday moves.
If you take a look at the price of
precious metals and the SP500 you will notice that precious metals started to
sell off about 10 days before the broad market bottomed in March. Money was
pulled out of silver and gold and put to work in the extremely over sold
Precious metals have now been moving
higher the past 4 days and I expect this is because the equities market looks
overbought and ready to roll over. Investors and active traders are starting to
put money back into the “safe haven” incase the rest of the market drifts lower.
Gold Precious Metal Trend Trading
In short it looks like gold is
forming an ABC retrace pattern which in the longer term is just a pause before
another move higher. Several indicators which I follow are pointing to higher
prices for gold as well.
Silver Precious Metal Trend Trading
Silver has been doing much the same
as its big yellow brother. It is currently trending down contained within its
channel but looking like it could make a move higher.
Precious Black Oil - Trend Trading
Crude oil has been trending sideways
for several weeks forming a very nice looking cup and handle pattern. A cup &
handle pattern is a bullish pattern. Currently oil is at the bottom of its
trading range and starting to move back up.
Precious Metals and Crude Oil
These commodities look to have found
short term support and are headed to test the upper channel/resistance levels
once again. It is very likely that the broad market will start to head south and
money will flow back into precious metals sending them higher.
The above patterns look very simple
to navigate but never underestimate the market. It thrives on people emotions
convincing them to put their money to work only for the investment to whipsaw
around swallowing your hard earned money. Trading is a dangerous game if not
handled with care.
My main focus when trading is to
take some profits early in the trade, and to exit when prices surge higher for
big profits or to cut my losses a position starts to go against me. If a trade
is a few percentage points in the money, then I make sure it will not go against
me. More often than not I take a small profit on the first half of my trade and
tiny or break even on the second half. This allows me to slowly and consistently
make money without any wild swings.
If you would like to receive my
trading reports please visit my website:
Vermeulen is Founder of the popular trading site
There he shares his highly successful, low-risk trading method. For 6 years
Chris has been a leader in teaching others to skillfully trade in gold, oil, and
silver in both bull and bear markets. Subscribers to his service depend on
Chris' uniquely consistent investment opportunities that carry exceptionally low
risk and high return. Reach Chris at: Chris [at] theGoldAndOilGuy [dot] com
This article is
intended solely for information purposes. The opinions are those of the author
only. Please conduct further research and consult your financial advisor before
making any investment/trading decision. No responsibility can be accepted for
losses that may result as a consequence of trading on the basis of this