Many times over the years, we have written about the frustrations of trading and we are experiencing the worst of it now. A couple of days ago, gold and silver looked ready to breakout to the upside. The probabilities were gold was going to run to new highs. Today the metals are threatening to breakdown again.
Suddenly, the excitement and exuberance of gold and silver has turned into fear and a possible reversal. Today becomes a huge day for traders and meaningless for investors. Traders have been getting chopped up with these sudden change markets including the false breakouts.
This type of price action is the reason why investors should never watch the day-to-day trade, they are not selling. Investors ask yourself if it is worth the grief and aggravation of watching gold and silver hour to hour and day to day. If you are investing, you are doing so with the idea of holding for an extended period and what happens today is meaningless.
Precious metals should be owned on a physical basis with capital that is not needed tomorrow or anytime soon. Trading should be done with paper knowing that we can trade either side without emotions.
In all markets price action determines what will happen in the next day, week, or months. Keep the two strategies separate, the worst trade anyone can make is turning a trade into an investment hoping for a way out. Traders must learn to take their losses and move on to the next trade.
Patience, discipline, and money management always win the day. Let the map of the markets show you the way.
Todd Horwitz Chief Strategist BubbaTrading.com
Stop being a prophet and make profits
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