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uro_who

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Everything posted by uro_who

  1. Exactly. The important thing is the price, how it moved, how it's changed during the session. That contains all of the knowledge regarding fundamentals, geopolitical changes, moves by big players and critically the reaction of all those in the market to those factors. Its usually humbling to try to guess where the market is going based on your interpretations of the news. The better way is to watch the market and agree with it by acting in the same way. No point in being correct and poor. I learnt that mistake when in 2003 I sold my house couldn't find another, I noted that the market had levelled off. I held on and it surged ahead. Using TA I no longer want to be correct before the move even happens because you'll be wrong at least 50% of the time, I use it to try to spot a real breakout/price move from a fleeting change in price. And as Red Kharma says because markets are fractal it works across time frames. Let me give you an example. When gold started its correction on the 9th of november the drop was presaged by a shooting star and an RSI of 77%. It then corrected with a triangle. It finally broke out of the triangle to the upside on the 21st of December ($808/oz). TA analysis states that once its broken out to the upside you've an over 90% chance it will at least reach the prior high of the triangle. It reached that on the 2nd January, it surpased the $847 as predicted and went on that day to reach $857. If you take a look at the chart the next couple of days were nervous before taking off again (it had crossed the all time high price remember). (all prices are mid point between bid and offer). A spread bet at £20 per point is equivalent to about £15,000 of physical gold. Over that couple of days you had a greater than 90% chance of earning £1000 for the risk of losing £50 if you place your stop carefully. You also know to take your profit by moving your stop upward until you reach $847 and then play it by ear. If you look at the charts you can see that many have taken their profits at exactly those times. You have now joined the 70% of chartists in the market and taken the cash of the 30% who had a feeling in their water. None of that had anything to do with news. Mostly that involves market players trying to manipulate the price for their own ends!
  2. It doesn't have to be collapse, it implies a risk of greater volatility up or down which is what we are seeing. Every drip of news about inflation is likely to prompt more and more people to buy into gold. Sorry bobsta as a bit of bad form I answered your post by editing my prior one. I've copied it below. Bobsta - another place to look is Technical Analysis for dummies. cheap and a good intro. Steve Nison wrote a good book on candlesticks, worth looking at. You'd imagine that it's flash in the pan but it was designed in 1700's Japan and made the initiator of the technique one of the richest men in the country. When all is said and done its just a way of measuring human behaviour and sentiment. We know the power of that on this site more than many others. It simply doesn't matter what the fundamentals say. Houses have been over priced since 2003 but it hasn't really helped. All that matters is the price movement. I used the my understanding of economics to trade at the end of last year and lost 30% of my high risk capital. Stopped trading, spent 2 months reading about TA, candles etc and re-entered and currently its working for me although you never know whats around the corner!
  3. Of course TA isn't 100% accurate. 70% depending on the pattern etc is more realistic. But be choosy about when to enter, take that 70% and have a fierce risk management plan to control losses and you can steadily move ahead. Its worth looking at http://thepatternsite.com by Bulkowski. He's spent a lot of energy looking at the predictive abilities of chart patterns and candlesticks. He's quantified the success rates. Many of the 'classics' are 50/50 and therefore useless but plenty are in the 70% range and some in the 80%. Not much in life has that degree of certainty. Bobsta - another place to look is Technical Analysis for dummies. cheap and a good intro. Steve Nison wrote a good book on candlesticks, worth looking at. You'd imagine that it's flash in the pan but it was designed in 1700's Japan and made the initiator of the technique one of the richest men in the country. When all is said and done its just a way of measuring human behaviour and sentiment. We know the power of that on this site more than many others. It simply doesn't matter what the fundamentals say. Houses have been over priced since 2003 but it hasn't really helped. All that matters is the price movement. I used the my understanding of economics to trade at the end of last year and lost 30% of my high risk capital. Stopped trading, spent 2 months reading about TA, candles etc and re-entered and currently its working for me although you never know whats around the corner!
  4. I have to say that for me TA does work. In fact it has increased my high risk savings account by 50% in the last month. It enables me to know when it's too risky to get involved and when the chance of being correct is higher. It helps me to understand when to buy and when to exit, without that its all hope, greed and fear! It does enable you to understand the feelings of the market. You do need however to understand not just the prices but candlesticks, RSI, MACD amongst other things. I always trade with knowledge of the news but the market much more often follows the TA than the news, simply using todays news to justify todays moves. 70% of professional traders use TA so if you don't understand the language of the prices you are at risk of getting burnt. My TA analysis of Fridays happenings is that there is nervousness about the price of gold. On the weekly and daily charts it was mildly overbought with an RSI of 68-70%. Previous big corrections have been at the 85% level. Fridays drop held where I would have predicted at 905'ish. On the 15th of January (daily chart) there was a bearish engulfing pattern. This is the most recent notable pair on the chart. The price came to this level and towards closed became a descending triangle on the intraday charts. What is the next move? Short term descending triangles breakout to the positive and negative exactly split, so no help there except to watch very carefully on Sunday evening as that is likely to mark direction of a fairly sizeable move (and the far eastern markets have mostly dropped the price overnight in recent trading). The weekly chart incorporating Fridays prices shows a shooting star. A possible reversal but not confirmed unless this weeks price pushes a good way down the price from two weeks ago. If that happens we will probably be in for 4-5 weeks of price declines. I'm a rank amateur but Trading Central's analysis is a week of consolidation followed by a push onto $970/1010. From my point of view the 'dramatic' move on Friday in GBP terms removed only 1.4% of the pound price. Not exactly earth shattering, much of the reduction was dollar strength rather than gold weakness. I expect an interest rate cut in Feb which will probably add a further 5% to the Gold/GBP equation. For the medium term it strikes me that when the worlds largest economy has interest rates lower than inflation, the worlds second largest trading area has increasing problems with inflation and all of the BRIC countries are seeing marked inflation the gold price is going to at least $1000 this year. I'm keeping a steady nerve but have a deal ticket open ready to short against my physical holdings if things look to get temporarily choppy!
  5. IF you look at the current price movements using market indicators like the relative strenght index its not at all bad. THe previous corrections (no mad drops on the last couple of years charts) have come with an RSI of about 78%. Currently we are bobbling along at 69% which is just the right kind of pressure to keep it jogging upwards. Of course there is always the risk that the Federal Reserve will see that interest rates are currently luidcrously low and that making everyone pay for those that borrowed too much is daft. But then again they may not. I therefore maintain my current exposure with hedges when it becomes overbought on the medium term indicators.
  6. She's an absolutely typical Nu-Labour MP. She studied American Literature and Film Studies at the University of East Anglia. Her only experience of work is a couple of years as a mangement trainee in the Inner London Education Authority and then a 'policy officer'. Followed by a career in the unions and as a researcher etc. She knows naff all about the real world and her policies are typical left wing authoritarianist. No smoking, no drinking nanny state nonsense. I wouldn't touch her with yours.
  7. From a purely chartist perspective I see it falling back at 950-975 possibly back to below 900 before reaching £1000+ After that it's no mans land. I'm a newbie chartist but spotted and made cash from the FTSE diamond and the Dow Head and Shoulders. My advice on charts comes with a health warning however.
  8. Warning - I havent got the faintest idea what I'm talking about. i've got three books on technical analysis and have read one and a half of them but here goes anyway (hasn't stopped anyone else on HPC!) The Dow and S&P are in a head and shoulders configuration, draw a line at the base of the dips and you'll see that today we dipped below that line (the neck line). That has a failure rate to produce a drop of 5% or more of less than 5% and an average fall of 23%. But beware 67% have a pull back first. I think we have probably had that as this is the second time it's crossed through the line. Expect the ultimate low in about 60 days. The FTSE is in a diamond top formation. Not quite so good as a head and shoulders but a similar picture. Take a look at http://thepatternsite.com/chartpatterns.html its so good I bought the book! I'm a skin flint and other than gold am a £1 a point man as I can't really keep an eye on whats going on. I'm also a control freak so I cant face the thought that I don't know whats happening with my cash. Anyway did alright today. I expect a modest pullback tomorrow am until 930 and from then on it depends on the RICS and UK unemployment figures. If they are nasty it could be carnage. Then it's onto 1430 and see what the dow does! Good luck and like I said, your guess is as good as mine!
  9. The money has already gone. Get out. Decide if the market is going to fall further and if so get back in then. Does that sound familiar?? I just think that most stocks have further to fall despite valuations. Good news is scanty at the mo. the only difference in getting out of equities now or not at all are the fees. Work them out. Are your shares going to fall a further 1%? Probably, you've made the loss already. However, take what I say with a huge pinch of salt. I too made a trading loss today (although I'm up 10% in the last 6 weeks)! Good luck!!!
  10. That price is someone looking to buy. Yeah I'd like to buy at that price but oddly neither him/her nor I will get any takers at that price!! (at the moment!!!)
  11. All of my trading/financial calendars say today at 0800. I agree, the figures are down, probably impressively and they are manipulating the release to pressure the MPC next week. Seems fishy, nothing on their site either.
  12. Has anyone got the energy, wherewithall and time to produce a house price graph with candlesticks, RSI, MACD and a moving average or two. Would be great to see one? I got suckered in to a bear trap in some time ago and have since learnt quite a lot more about the way that markets work. Anyone got that kind of graph or know where I could see one? Cheers in advance.
  13. Good post Bri. <to$$er_mode>Can I make a highly pedantic request? Although I'm far from grammatically perfect, the Americanisation of English drives me mad, the world is Americanised enough already. I wonder if you could consider using the word maths rather than math. I can't bear having to wear my baseball cap backwards, it lives such an odd sun tanned patch on my forehead - cheers old chap</to$$er_mode>
  14. This is dynamite. The only thing keeping the BTL bandwagon on the road is BMV purchases. We need to get this into the public domain as broadly as possible. FP any ideas, press release or something similar?
  15. Should make it possible for her to pick it up later in the year for less.
  16. Thanks Laura, I see that another work of fiction comes out of embargo at 0001 this morning, the CPI and RPI figures. Difficult to know if they are going to be Booker Prize or Perrier Prize winning.
  17. Anyone know what tomorrows figures are going to say? My guess is up 0.5% or something, seasonally adjusted, interest rate cut out of the way sort of number.
  18. I would imagine that Basel was designed in part to avoid 1930's style runs on banks. In todays climate even 8% cash reserves seems low, but 5% crikey. It sounds rather double or quits to me. A better medical metaphor might be your surgeon taking speed and cocaine just before he operates on you because he's feeling tired.
  19. Are you sure. House prices where I live have gone up massively. The houses I was looking at in 2003 at £450k are now £1.5 million. The average house round here is 11x average earnings compared with the long term of 3.5. 25% - don't make me laugh!
  20. At 1400 the CB's announced that the drinks were on them. Bank shares soared, gold jumped for joy and oil's on fire. It wobbled around 9370 for a bit and has now pressed on toward $95. Not bad seeing as it was under $90 at 10am this morning. Inflation anyone?
  21. If much of this comes to pass in the UK, particularly with the heavy lowering of interest rates then one thing that will devalue markedly compared with gold is the pound!
  22. That's 10% off sold prices. Around here we've been seeing 10% off asking prices since the summer. That gives 20% of current asking prices, now that's a bit more like it. Does have some way to go however, prices around here for decent country properties have doubled to tripled since 2003. Now that puts a 20% decrease into perspective. Would need to see at least 50% falls to revert to the mean let alone overshoot.
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