GUNNER24 Trade of the Day 01/15/2014
Sell Platinum at 1430 / US Indexes tactics
Dear GUNNER24 Traders,
Sell Platinum at 1430
For a year, platinum has been trading more or less sideways. Weekly is confirmed to be down, and the long-term monthly time frame is still bullish. Yesterday, the current daily up-cycle seems to have topped turning into the new cycle window, on the 17th day of the upswing. Thereby platinum apparently wants to join the well-known and popular 17-18 day cycle of the other precious metals. This is the very moment it may fall/weaken in general with this cycle period:
In the daily 5 Candle GUNNER24 Up of the current palladium future contract PLJ4, yesterday being the 17th day of the upswing, the horizontal resistance that starts from the lower line of the 2nd double arc was reached at the highs at 1447.50. From there, platinum is presenting a hefty rejection that is supposed to go till tomorrow/the day after tomorrow, to the technically pretty strong support of the first double arc. In addition, yesterday the Rally Angle was fallen below on closing base = confirmed daily sell signal. Correspondingly, our downtarget for the short-engagement is at the upper line of the first double arc. This is at 1409$ for tomorrow. A several hour bounce in the down move is likely to provide support to the horizontal that is lying at 1415$ now.
The target/ he targets of the possible trades is/are pretty easy to be made out. The razor-sharp entry into the shorts, considering our tighten-0.2% SL-rule, is more difficult yet, since the metals tend to extreme fluctuations because of their constantly thin market depth. Promptly some traders are caught on the wrong foot in futures trading being obliged to stock up:
The most tried and tested vehicle for entries is always looking for the most objective Gann Angle that is giving the decline or also a rise in price and time, intraday. The higher the intraday time frame is (I always check 1, 4 and 8 hour time frames regularly) in which we can identify it, the more meaningful and important will be the given angle resistance or angle support, respectively.
In the 8 hour time frame we can see exactly where the ruling angle is taking its course. For this candle it’s at about 1430$.
Another vehicle I use to underpin entries at GUNNER24 Magnets is the volume analysis. It’s of use to show us where the respective bull- and bear-camps are situated/beginning/taking course in terms of price. Here are the current findings from out the 1 hour chart:
I’m searching for high volumes because they may always indicate the beginning of something new. Starting at A) and at 1420 to the candle high at about 1434, about 2100 contracts were traded on 01/10 at 13:00 hours GMT. It’s the highest traded volume in the 1 hour chart since about a week. As the candle is green starting a new upswing there, that is where the bull-camp has got to be, actually beginning at the lower end of the candle, hence beginning at the 1420 low und until the upper end of the candle body at 1424. So it’s the bull-camp at 1420-1424.
The bear area is visible at B): Today at 1:00 hours GMT, 820 contracts were traded leading to the red candle with the long body. That’s pretty much for the Asian trading hours. Correspondingly meaningful is this bear area. It starts at the high of the candle = 1429.50 finishing at the 1419.40 low.
The result of the volume check in the 5 and 15 minutes time frames is this: The half of the contracts was traded down at the low. So it was the low they bought there. Maybe a counter-move up to at 1430 is to be expected for the coming 4-5 hours.
Since the daily trend appears bearish at the moment, the area around the 1430 is likely to be defended very strongly by the bears yet. That’s where they are supposed to pull out their claws. Beside by the current MA 20 resistance in the 1 hour chart above – being expected to be at nearly 1430 in 4-5 hours - that is visualized by the Gann Angle Resistance in the 8 hour chart at 1430, as well!
Please use ETF, options, CFDs or warrants reproducing this trade. Sell when PLJ4 trades at 1430 and cover when PLJ4 trades at 1409!
GUNNER24 Trade of the Day orders for 01/15/2014:
Orders: Sell-Limit at 1430. Stop-Loss (SL) at 1432.86. Place Buy-Limit = downtarget at 1409 after the Sell-Limit order was triggered. Delete the stop-loss order after the buy-limit order was triggered. Sell-Limit order valid till today. Buy-limit order and stop-loss order valid till 01/17/2014.
US Indexes tactics
Yesterday the bulls stroke back, putting a flawless uptrend day on the floor – lows at open/highs near close. Since the indexes we consider, Dow Jones, S&P 500 and NASDAQ-100, by the yesterday rally all denied the more or less strong sell signals of the day before yesterday and furthermore the S&P 500 has obviously developed monstrous up-energy from the 1820 horizontal weekly support, one thing is to be recorded: The correction in the uptrend finished with relative high odds rule-compliantly on the 8th day of the correction – the day before yesterday. A new up-wave is on the way now, being in reach some new higher highs than those of 12/31/2013, at least in the S&P 500 and NASDAQ-100.
But this theory still requires confirmation. For yesterday, Dow & Co closed just narrowly above or at their respective daily resistances. The new up-wave won’t be confirmed before all 3 indexes close above yesterday’s close today. Only in that case, perhaps they will have taken the determining daily resistances upwards and above all produced a daily reversal candle… And it will take this one to confirm the official end of the correction!
The EW guys in the web say: The ABC correction from the 12/31 highs in the S&P 500 was finished the day before yesterday at 1819.80, and the market is now in a new 5 waver again having shown yesterday the 1st of 5. I also tend to this realization.
So, following the tendency, today we’ll have to change sides again looking for long-entries, because the indicators and oscillators turn upwards in the 8 hour time frame, upwards still having plenty of room. A possible entry in longs today is 1835, but I’d prefer the 1830 environment…
Short Amazon Inc (AMZN) at 397.80$ since 14. January 2014. Stop-Loss (SL) at 401.77$. Buy-Limit = downtarget at 365$. Buy-limit order and stop-loss order valid till 02/03/2014.
Markets, Money Management and Trade Size
I will merely analyze the market. There are so many instruments in the world outside our GUNNNER24 Traders use to trade, and hundreds of popular ones among them, often depending on a trader’s time horizons... I don’t consider me able to adjust the market recommendations to all the popular ETFs, different CFD or futures contracts. All I’ll analyze is pure market action - the index, stock or most current contract and forex!
The trade size you should use depends.
A) On your account size:
I usually follow the rule of thumb which says, never bet more than 1% of your account size for each trade. So I avoid overtrading...
Let’s say you have got a 30.000US$ account granting you a nominal buying power of 300.000US$ up to 500.000USUS$ and even more, depending on your broker and instrument. In that case your trade size shouldn’t be more than 3.000US$-5.000US$ taking into account your buying power.
Another - more conservative - method is taking into account the available margin. Usually, 30.000US$ account value equals 30.000US$ available for margin trading. So the trade size is 300US$ taking into account the margin.
Within Trade of the Day I ask you not to bet more than this 1% per any trade.
The other point to consider for determining the trade size is:
B) if your trading style is rather active, supposing you regularly have 30-50 open trades, just as I have - CFD/ETF, here some stocks, there a future contract. So I often trade risky somehow, but I split the money/bets. Even in such a nice trend as the stocks are showing currently, I never ever trade too risky. I never load the boat with 70% let 90% of my account size. 50% is the maximum.
I trade for my living and for my kids and wife as well. A regular income is important. The big-bang bet isn’t! The market would win such a big-bang bet for sure!!
When I have a lot of open trades, maybe up to this 50% of my account size/available margin I avoid trading more. So if you are an active trader having a lot of trades running at rev limiter (50% account size) please avoid trading even though we/I give you some fresh recommendations, because this would rise YOUR risk!... During the test phase that happened frequently. We had 3-5 open trades sometimes and that’s why it’s elementary important that we/you have to use tight SL. Order management is absolutely crucial for Trade of the Day.
You’ll have to place really each and every order accordingly, you know. Forgetting only one time the SL would make this trade getting worse and worse…
Based on the George Douglas Taylor Trading Technique that I’ve been studied and originally traded for years transferring it onto the modern markets by constant observation a five day pattern of the single days of the week has resulted.
The crux is not so much that the entire week has to work perfectly. Perhaps it does just at a 50% because the day patterns may shift by one or two days. In the strong upwards trends sometimes you see 4 buy days and only 1 sell day. It’s important to recognize that the day proceeds ideally-typically and to trade accordingly.
My personal trading style has always been the contrary to that of the crowds because the crowds always loose. Especially in gold and silver trading I like to buy the corrections Monday to Wednesday and on Friday if the day patterns correspond with some important GUNNER24 Signals.
I use to go short intraday just on Thursday when the week high is sold off AND provided that the corresponding GUNNER24 Setups signal so covering the shorts when the cycle is resumed.
The ideal five day pattern in an upwards trend – precious metals and US stock market – Do use those patterns for your intraday and swing activities!
Monday: Buy day. Strong up-day. Low established first. It often ends at the day high. Unthinkingly you may buy all the intraday corrections because the week high comes later in the course of the week.
Tuesday: Buy day. Weaker up-day. A higher high is produced. As early as now the crowds ponder whether the prices mightn’t run too high partially going short already. For me it’s the day when I can cover my Friday and Monday longs. In intraday I try to go long in case of corrections until the Comex opening.
Wednesday: Sell day. Actually the day for covering the longs and for the first short entry. It’s got some different forms. It closes at the same level as it had opened. Frequently at first the high is established because more and more traders short the market. Here the longs fight against the shorts. You recognize that if many teeth, many nicks, many spike candles are to be seen in the chart. On Wednesday I use to do nothing. Only at a 20 to 30% the shorter hearts are pleased because during the whole day there’s only sell-off.
Thursday: The classical sell short day. Because the Wednesdays often close as they had opened the market participants have to cover their shorts because in the beginning the market runs quickly upwards…! And frequently they turn their positions into the high direction being caught on the wrong trail again. Then the market often lays down a beautiful sell-off. In the evening mostly a strong rally follows. That’s where we cover the shorts.
Friday: Classical buy day in the upwards trend. It’s nothing for weak hands. Here’s where you buy the positions near the Thursday lows which you cover again next Tuesday/Wednesday. If you discover that the prices have steadied or even are rising a little bit by closing the five day cycle should continue in the following week.
In the charts we work with the following symbols: