On August 12th we went short Gold at 1960 riding it down to the 1770 level and are now reversing to the long side of the market. Once again, we were able to capture the bulk of the move down without overreacting to short term emotional swings. The trade was a classic example of grabbing a big percentage of the move.
Silver came close to a reversal while staying on the short side. Any rally from Monday’s closing prices will trigger a reversal in Silver. Platinum remains long, although Monday’s selling was ugly it appeared to be a rolling out of spreads to long Gold.
This action should help you understand the value of price action trading without news or opinions. One of the main keys to being a successful trader is the ability to remain emotion free and avoid the pitfalls that most fall into. Emotions, news, and opinions have destroyed more traders and investors than anything else.
Always keep a clear and logical mind when trading or investing. Having the ability to be objective about price action is the biggest single tool that can save you from making bad trades that eventually lead to ruin.