After reaching lows on Wednesday morning before the FED announcement, Gold, Silver and Platinum have rallied hard and appear ready to reverse direction. Today’s action is the key; a higher close will probably trigger a reversal.
Although we remained short through the rally, we were not aggressive at selling more as we recognized a change was possible. Learning to follow the phases of the market and the signals they are sending are important to trading success. There are no guarantees but making a decision based on what you see will improve your trading.
As we approach Christmas and the end of the year, trading action, volume should be light. This type of action can lead to exaggerated moves. Trading desks will be on skeleton crews, many traders vacation after today. We will trade the trend but recognize the possibility of whipsaw trading.
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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