Gold & Equities on the Verge of Breaking Out
Source: Chris Vermeulen (3/10/11)
"Don't take any large positions until we see what happens overseas."
As much as I love to trade, I have been sitting on the sidelines for a few weeks giving this market some time to sort it's self out. As we all know, there are times when you get really aggressive and other times when it's best to stand aside.
It is very important to note that each trader sees the market in a different way and only when it is aligned with what you are comfortable with trading, should you step in and trade. If not, it's best to wait for more-favorable price action. It took me years to figure this out but now that I know what I am looking for and on what timeframes, trading is less stressful. And I know I don't need to be trading all the time, there is always another opportunity just around the corner. . .
Gold has been trading sideways for almost two weeks now as it tries to break free of the December high. It is much in line with the SP500 chart above. I believe Friday or early next week the market, dollar, metals and oil make some sizeable moves either up or down.
In short, I don't think it is wise to jump the gun and take on any large positions until we see what happens on Friday overseas.
If nothing happens, which is kind of what I am thinking, we should see the extra fear value come back out of the price of gold, silver and oil (drop in price) and possibly help boost equity prices.
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