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His Secret To Day Trading Gold

It does not matter what your specialty is for trading is we all have our own little trading secrets to help use better time our trades. While many day traders focus on individual stocks like aapl, goog, tsla etc… I like to focus on day trading gold.

Years ago I shared this little secret on how I get an edge day trading gold and it still amazes me how many of those people still use it today, including myself.

Time and time again gold traders are given great insight on how and when to day trade gold. I use the free 24hour Kitco gold chart which is shown below, and I watch it like a hawk.

It is easy to get a feel for how gold moves each day with this chart. Once you get a feel for it and see price patterns repeat themselves week after week, these opportunities quickly become an easy way to add a few trades to your day trading routine.

This Kitco day trading gold chart is an amazing tool for observing the price of gold over a 3 day time frame. What I’m going to show you is how it can provide opportunities for day trading gold.

While this chart may not look like a quality trading tool it does provides very detailed information for daytrading gold and for swing traders as they get ready to enter or exit positions. Looking at the chart below you will notice that price has similar price patterns and turning times throughout the day. Often enough the movements are very similar allowing us to take advantage of these price patterns to day trade precious metals, silver included.

Free Day Trading Gold Charts – By Kitco

Day Trading Gold

 

Gold Day Trading

Close Up Of Spot Gold Chart

The chart below is regular trading hours only 9:30am – 4:00pm ET. You can see the price action following the previous day’s movements. Blue is the previous trading day and Green is the Current day.

When there are large price movements in gold during these hours I like to take advantage of them using the previous days price action as my guide. If you didn’t notice the Green line (Today) makes the move before the previous days move. Why? Looks to me like there are a lot of other traders out there like me getting ready for these opportunities and because its human nature to want to be first they cause the moves to happen slightly sooner than the previous day. You should factor this into your trading and be ready to take action when price looks to be starting a predicted move.

 

 

 

 

Intraday Trading Gold Chart via GLD

The chart below shows the last 4 intraday sessions for gold using the GLD ETF. As you can see these sessions had very similar price movement. This is a 5 minute chart of gold using GLD. I trade it using the 3 minute chart as it allows the best timing for entering and exiting positions and this 5 minute chart keeps my head clear for the key turning points because it is easy to get caught up in the one minute chart noise and miss the important patterns.

If you prefer trading spot golc via FOREX/CDF/Spread Betting and you are not a US resident you can use the firm which I have been using for nearly 8 years and the broker is AVAFX. The nice thing about trading this way is that you can trade 24/7, you get a lot of leverage, its commission free trading, and they have 100% signup bonuses to match the amount you deposit.

 

Best Gold Day Trader

 

 Example Day Trading Gold Chart

Gold Trading Newsletter

Above is the chart of GLD ETF and some actual trades. I am a very conservative trader and I like to lock in profits once I am satisfied with a move or if the chart shows any indication it may go against my position. I tend to exit trades a little too early but my focus is on catching the middle section of a trend because they are the safest areas to trade I think.

When there are no swing trading setups I focus on finding these intraday day trading gold patterns along with SP500 index and Nasdaq day trades to generate my weekly income.

My main focus for trading is swing trading ETFs and I have an automated trading system which i developed and it trades most of my capital on autopilot.

To sum things up I wait for a trend reversal or continuation pattern to form before I enter and exit positions. I am a firm believer of using breakeven stops, meaning once a position moves a certain amount in my favor I move my exit order to my entry price so that I have a risk free trade running. My swing trading goal for GLD ETF is 2-5% per trade which would last 2-10 days.

Get My Free Weekly Trade Idea Alerts: www.GoldAndOilGuy.com

Chris Vermeulen

 

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Video on How to Day Trade Spot Gold & the Indexes

March 13 2010
Last week was an exciting one for intra-day traders who follow the spot gold and major stock indexes. Actually, since early November 2009 the market has been performing very well for us day traders.

As we all know the market is consistently changing its price patterns and momentum from up, sideways to down, which in turn affects everyone’s trading results for any given month.

For swing/position traders who trade using the daily charts they will find some months will favor trend trading strategies, while other months favor short term range bound strategies, and other months that just are not good for trading at all like last November and December.

During extremely choppy market conditions such as we saw last November and December, the market was up an down like a yo-yo. Swing/position traders had a tough time making money, and speaking for myself, once the market gets like that I patiently sit in cash or hold very small positions.

The good news is that when the market become choppy and swing traders are having a tough time making money (which is fast intra-day up and down movements), day traders come out of the wood work like fire ants. There are crazy amounts of money made and lost during high volume intraday trend reversals and pattern breakouts.

Day Trading Spot Gold – YG J0 Gold Mini Futures Contract
Here is a quick video I did of my trade in gold on March 9th. This video shows a trade using the 5 minute spot gold chart profiting $6.00 per ounce with minimal downside risk. Depending on what you use to trade gold – Futures Contract, ETF or CFD – you could have profited $600-$2,400 in less than 2 hours.

This is the second video I have ever done so it’s nothing fancy by any means. It will take me a few more videos to get a good understanding of them as I do plan on doing weekly videos in the coming weeks and will be sure to make them more exciting.

Gold Day Trade
Click Link if you cannot see the video below: http://www.youtube.com/watch?v=JHSc6JORyew&feature=player_embedded


Day Trading the Index – DIA Exchange Traded Fund

If you watched the gold video above you will see how I day traded spot gold in the morning and why I used futures as my investment vehicle. That being said, anyone could have traded the GLD or DGP gold etfs.

Only a couple hours later I saw a great Head & Shoulders pattern on the broad market indexes. Taking a step back, my chart analysis has been telling me to look for a reversal pattern on the broad market as I feel it is over bought, and I still do…

So when I saw gold roll over then a reversal pattern on the Dow Jones Index, I decided to take a short position. Also, I noticed the price reverse down off the right shoulder.

This time, I traded the DIA etf just because it is where I saw the pattern develop first and because I have a thing for DIA (I just like trading it).

So once the price reversed down off the right shoulder with the long red candle I went short at $106.07 with a first target at $105.85 to sell half of my position, and then move my stop to break even on the balance of my position. I ended up pocketing just over 25 cents per share in gains which does not sound like much but because day traders get 4:1 and some brokers allow 10:1 leverage you can trade large amounts of shares for these quick trades.

Trading the DIA I focus on 500 or 1000 shares per trade depending on how I feel about the trade. This particular trade I did 1000 shares pocketing $250 profit within 70 minutes.

*Trading Tip*
If you see a Head & Shoulders pattern with a neckline angled up (see chart below), then you should focus on trying to short the top of the right hand shoulder (the first reversal candle). The key here is to be short before the index (or any investment) breaks the neckline.

Once a neckline is broken a large surge of sellers should rush in as everyone jumps out of their long position. Also, this is the point when aggressive traders start taking a short in order to take advantage of the breakdown and price depreciation.

So if you see a right shoulder drifting higher into resistance with that bearish looking flag, be ready to short once you see selling volume pick up and a drop in price.


Day Trading Spot Gold and the Indexes Conclusion:

Well I hope this short report helps you to take advantage of the market using different trading strategies and time frames. Every day and week is different and I jump around from trading 60 minutes charts, 4 hour, daily and the occasional 5 minute charts like the ones above.

I try to stay away from the 5 minute charts simply because they move so fast, and the shorter the time frame the smaller the potential. But some days favor it so I just take what the market gives me and that’s all we can do.

On another note, if you are interested in my new high-end trading service that trades all the setups in real-time, I will be launching this service with my personal trades and analysis for you to trade alongside me!

You will receive all my intraday and swing trade alerts for indexes and commodities allowing you to trade which ever vehicle you want – whether it’s an ETF, Leveraged ETF, Futures Contract or CFD. This way your timing is accurate, your downside risk is carefully calculated and you can trade which every investment you are comfortable with

There will be a 24/7 chat room allowing us to trade around the clock when setups arise. Also, members can swap ideas, ask me questions, make new trading buddies etc… There is even a squawk box feature! I can and will talk live with audio to everyone in the chat room for important news, trades alerts or questions.

All trade alerts are instantly posted in the members area, chat-room and sent via email making it one of the most powerful trading services I have ever seen available online.

If you are interested please fill out the form to be notified for this service which will start the last week of March or the first week of April. It will have limited availability to keep it personal.


Get Notified Of Launch.

Chris Vermeulen
www.TheTechnicalTraders.com

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Gold, Silver, Oil and Natural Gas Mid-Week Trading Charts

March 11th 2010
So far this week has been pretty slow. Large cap stocks continue to lag the market which can be observed by looking at the Dow Jones Industrial Average which still has room to move higher before breaking the January high.

One important thing to note is that volume has picked up this week considerably – particularly on the SP500 and OEX. It’s difficult to say if this volume is a good sign or not.

A lot of stocks and sectors are trading near their January high and this gives traders a reason to unload shares. On the flip side, the several sectors and indexes have broken their January high and this triggers a surge in volume as breakout traders try to take advantage of the new high and momentum. So you can see how the surge of volume is not a useful indicator right now.

Here are some charts of what I think we could see in the coming weeks.

US Dollar Index – Daily Trading Chart
I follow the US dollar index very closely simply because it affects the prices of stocks and commodities. I used a line chart below in order to take out the daily candle stick noise which made it very difficult for our eyes to pick up this pattern.

The chart shows a possible head & shoulders pattern and if that is the case then we should see the dollar start to slide lower. In turn, this would boost stocks and commodities. This is the fuel that I think could really move the market sharply higher in the coming weeks.

GLD Gold ETF – Daily Trading Chart
The price of gold looks to be setup for a nice bounce off support and the timing could just work out if the US Dollar starts to drop over the next few days. There could be a low risk setup just around the corner.

SLV Silver ETF – Daily Trading Chart
Silver has held up well but today’s reversal candle to the downside scares me a little. The odds are that silver will carry this strong momentum selling down for another 1-2 days. Again, with any luck, it will test support and the US Dollar will start to slide lower.

Crude Oil – Daily Trading Chart
Oil has had a great run the past month but as you can see it’s currently trading at the top of a large trading range. I would like to see a sideways move before it takes another run at the $84 level, but the 7 day bull flag that formed two weeks ago may have been enough to maintain the upward momentum. Again, if the Dollar drops we will see oil rally.

Natural Gas – Daily Trading Chart
This chart is actually very attractive looking. Even if you do not understand how to read charts I think it’s safe to say this one is a no brainer.

I will be closely watching for a potential low risk setup in the coming days.

Mid-Week Trading Conclusion:
In short, stocks and indexes are trading at resistance levels with many of them making new highs and that is great to see.

A lot of things are trading in limbo waiting to see what the US Dollar is going to do. Several months ago I posted some charts showing that 81 would be a key resistance level for the dollar. If it broke above that then 84 would be the next key level to watch. So we just have to wait and see… the hardest part of trading is the waiting.

Gold, silver, oil and natural gas all look like they could continue higher in the next few days if things unfold that quickly. But the market always finds a way to drag out moves so we could still be a 2-3 weeks away.

I hope this report helps give you an idea of where things are at in the market.

If you would like to receive my Free Trading Reports and Analysis be sure to visit my website:
















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Chris Vermeulen
www.GoldAndOilGuy.com

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Have Metals and Stocks Bottomed Yet?

Everyone is wondering if gold, silver and the indexes have bottomed after last week’s heavy selling. To put things into perspective there were over 30 sell orders for every 1 buy order at the NYSE. That is pure panic and to confirm extreme fear, several of my broker buddies said last week was crazy with clients demanding to liquidate their positions ASAP to be 100% in cash.

This type of sentiment and price movement warns us of a possible market bottom. I am getting the feeling that traders and investors have been expecting this sharp drop I don’t see or feel a large amount of fear in the marketplace. Last Thursday and Friday war crazy but I think we need one more drop to really shake things up before a bottom is set.

Below are some charts showing where the market currently stands and what the charts are pointing to.

GLD Gold ETF Trading – Daily Chart

Gold is clearly trending down on the daily chart. One more thrust down should shake things up enough to trigger the next rally.

SLV Silver ETF Trading – Daily Chart

Silver has formed a Head & Shoulders pattern and has broken through multiple support levels. A measured move to the down side would be $14 for silver which could happen in the coming days.

SP500, NYSE, GOLD Futures, US Dollar Index – Intraday Charts

These charts clearly show the price action of the past month. As you can see the trend of stocks and gold are down with consolidations (pauses). This is the exact reason why you must trade with the trend and not do counter trend trades. Bounces are more like sideway movements making it very difficult to try and play bounces in a down trend.

If you focus on selling at key resistance levels then moves tend to be much more profitable. That being said, we did go long last Friday because of the extreme oversold market level. I was expecting a follow through Monday or Tuesday which has yet to happen. We have now moved our stops to break even or better to eliminate our down side risk.

Spot Gold 24Hr Trading Chart

This chart says it all. The market and gold is very volatile making it difficult to trade right now. Bulls and bears are battling it out. Only time will tell!

Stocks & Commodity Trading Conclusion:

In short, it’s been a slow week without any real exciting moves. Thursday and Friday could be interesting if traders exit their positions going into the long weekend in order to protect themselves from any surprise economic news.

From the looks of gold, silver and the indexes I sense selling could be just around the corner. We are currently long a few positions with our stops are break even or better in hopes for a pop and rally going into the holiday weekend but only time will tell.

My wife and I have our first child due on Saturday so I may disappear for 1-2 days in the coming week as we welcome our little princess into this new and exciting world.

If you would like to receive my trading reports directly to your inbox please visit my website at:

Chris Vermeulen
www.TheGoldAndOilGuy.com

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How to Trade IntraDay Gold and SP500

Last week was an incredible week for trading the intraday charts. With rising volume and volatility prices began to move up or down for extended periods of time allowing traders to profit from these powerful short term price swings.

During times like these traders using the daily charts for their guide found the market very difficult to time because of the whipsaw action each day. In this case, it is definitely best to stay clear of the market until the dust settles. But for a trader who watches the intraday charts, this is when serious money is made on a daily and consistent basis.

Most traders avoid using intraday charts because they either:

1. Think it’s day trading and do not want to sit in front of the computer all day
2. Do not understand how to trade in these “intraday” time frames.

Intraday trading is one of the most over looked yet most profitable trading strategies, in my opinion. One of the reasons I like/love it so much is the fact that it provides high probability setups on a weekly basis and trades generally last 2 -36 hours. Also, this strategy carries very low risk simply because you are in cash most of the time, putting your money to work only when high probability setups form.

If you are an active trader you should have been making money hand over fist last week. Below are close up shots of my charts:

My eSignal Trading Platform

This is my main trading screen which allows me to see the entire market. This, to me, is like a dashboard of an airplane. Each mini intraday chart is like a gauge hinting to what the plane in doing (horizon indicator, fuel, air speed etc.) My custom dashboards quickly allow me know if the market is heading up or down, what speed it is moving measured by volume and momentum, and if all pistons are firing which sector is really moving.

My Custom Dashboard

Quotes for every index and sector
Top Row: 60 minute charts with volume of: DIA, SPY, QQQQ and NYSE
Second Row: 60 min chart of NYSE TRIN, NYSE Adv/Dec, 60min Gold, 60min Oil
Bottom Row: 120 minute chart of the US Dollar, Interactive Brokers Trade Window

In short, I can see waves of money flowing in and out of each sector. These views give me a strong sense as to the strength of momentum. From these observations I determine whether the setup is favorable for shorting into light volume rallies, shorting into resistance levels or buying oversold sell offs in up trends.

Also, the chart patterns on the 60, 240 and 480 minutes charts are so powerful and accurate that you only need 2-3 trades a week in order to make decent money.

I would like to note that I do have 4 larger charts with different time frames allowing me to really get a feel for a trade before I commit money. These charts are Weekly, Daily, 240 minute and the 60 minute chart.

If you want to see some exciting daily charts of gold, sp500, oil and silver check out my weekend report: http://www.thegoldandoilguy.com/articles/gold-sp500-psychology-they-bail-we-buy/

SP500 Day Trading Futures Signal – 30 Minute Chart

The SP500 ES mini contract, or you could have traded the SPY exchange traded fund, provided an excellent intraday short trade last Wednesday.

All the indexes (NYSE, NASDAQ, SP500, DOW) drifted higher on light volume. While you can play the long side of these low volume rallies I prefer to stay in cash and wait for another short setup. Trading with the short term trend (240, 480minute charts) is crucial. Counter trend plays tend to be weak and short lived.

In short, the SP500 drifted into a resistance level on light volume and the NYSE TRIN indicator was rising in a very strong way. The combined information of price, volume and the TRIN indicator were screaming – short the market.

When the TRIN is above 1.00 it means the majority of the trades being executed on high volume NYSE stocks are sell orders. You don’t see the TRIN rise this high without the market selling off as it did on Feb 3rd. But when it does, Bombs Away – time to go short!

The next day the index crashed with panic selling across the board. The NYSE had over 30 sell orders for every 1 buy order. Now that is panic selling and, coincidentally, exactly as has happened at each bottom formed throughout 2009.

Intraday Trading SP500 – 60 Minute Chart

This chart clearly shows the high probability setup which took a few days to form. A short position was taken during the small bear flag pattern. My short position was covered on the break of a new high formed on heavy buying volume.

Intraday Trading Gold Futures – 120 Minute Chart

Gold had virtually the same setup as the SP500.

Intraday Trading Gold & SP500 Futures or ETF’s Conclusion:

As you can see intraday trading is nothing like what most people think it is. Trading using the 60, 240 and 480 minute charts really opens one’s eyes, allowing a panoramic view of the price action the market has to offer.

As most of you know, my goal is to trade low-risk, high-probability setups. And, the less time my money has to be in the market, the better.

If you are interested in getting more Intraday Analysis and Setups for ETF’s, futures and CFD’s be sure to join my free newsletter for Trading Futures and ETF’s:

Chris Vermeulen
www.TheTechnicalTraders.com

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Possible Trend Reversal In Gold and Indexes

Feb 2nd, 2010
We are seeing the market follow through from yesterdays strong rally with the Dow, SP500 and NYSE break the previous highs seen on the hourly charts. We now have a higher and high and waiting for a pullback for a higher low. This would complete the trend reversal and this is also the definition of an uptrend. There is a little more room for stocks and metals to move up today before trading deep into the next short term resistance level.

DOW & SP500 Hourly Charts

Gold Hourly Chart
Gold and silver have put a in the same move as the indexes mentioned above. I figure we will get a pause here for a couple days as the metals try to push up through this resistance level.

US Dollar Hourly Chart
The US Dollar has formed a very nice bull flag and is trading at support. This has me thinking that the majority of index and metals bounce is finished, for now anyways. The dollar should start to bounce in the coming hours which will put pressure downside on metals and large cap stocks.

USO Oil Hourly Chart
Oil has put in a solid bounce as it moves above its previous high set on the hourly chart as it also tries to reverse to the upside.

Quick Wrap-Up
It looks as though the downward trend is starting to reverse back up. During transition periods like this is when things generally get even more choppy. I am on alert for new setups in commodities and ETF’s as this could be a possible bottom.

Get my Trading Reports Via Email Real-Time:

Chris Vermeulen
www.TheTechnicalTraders.com

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Educational ETF’s, Futures & CFD’s Low Risk Trading Setups Explained

Jan 29th, 2010
I thought I would put this more detailed report on finding and trading low risk setups for gold, silver, oil indexes etc…. In short it does not matter what time frame you trade with or if you trade exchange traded funds, futures contracts or CFD’s (contract of difference).

This type of trading setup works for virtually every investment but I mainly focus on trading: Gold Futures, Gold ETFs, Gold CFD’s, and the SP500 & Dow 30 futures, ETF’s and CFD’s as I find they are very accurate and profitable.

Obviously swing traders who watch the daily chart will have few trades because it takes weeks and months for these low risk patterns to form. This is the reason I am using short term intraday charts and using a setup from yesterday (Thursday) for demonstrating my trading setups.

My Short Trading Setup – Rough Guideline
1. Trend on 2hour and 1hour charts are down
2. Increased volume during sell offs, and light volume on rallies/rising prices
3. Entry is best at Fibonacci retracement level which is also at a previous resistance level.
4. Set Stop just above the resistance level you are expecting the current price to stop at. Exit if this top is penetrated and wait for a new opportunity.
5. Cover half of your position just before the investment reaches the first level of support to lock in gains and reduce overall risk.
6. Once the price of the investment starts to make a new short term high exit the balance of the position. Shown in the charts below.

DIA – Dow 30 Index Fund
This is a chart I sent to members on Thursday pointing out the market weakness. We had a nice sell off in the morning and the price drifted up on light volume later in the afternoon. This low volume drift is crucial to recognize as it tells you the general public is buying. This is what Big Money likes to see. After they crush the market with their large sell orders in the morning they take a break allowing regular retail traders/investors move the market back up before the big sellers start dumping shares again.

So, I am looking to short at a resistance level in hope the big sellers step back in.

DIA – Dow 30 Index Fund – End of Day
This chart quickly shows the two intraday setups for shorting at resistance levels. Both trades worked out well but wait until you see the results of trading with futures or CFD’s shown later.

Anyways, the first short was a great play but we did not see the big sellers step in, which led to a reversal and the price continued to move higher taking us out for a small profit.

The second short had huge selling volume indicating sellers were back in control. This play we held into the close. The next chart shows how this is done.

DIA – Dow 30 Index Fund – Step By Step Play
The chart is a little small to see but it explains and shows how these low risk setups should have been traded according to my trading strategy to maximize gains while minimizing risk.

Dow 30 Futures & CFD Day Trading Signals/Setups
This is the same Dow 30 index but is zoomed out so we can take advantage of the 24 hour price action which the futures market trades.

Here I show the Fibonacci retracement levels which happen to be at resistance levels from earlier that day.

During regular trading hours the trades were the same as the DIA etf above, but with futures trading you can traded 24 hours a day. So with the last ETF trade I talked about earlier we only made 28 cents profit per share, but with futures we could have held this position until it fully matured netting a total gain of 40 cents per share. This is 42% more profit simply by trading with futures or CFD’s.

To make things more exciting there happened to be another fantastic trade after dinner making us another 45 cent move. These gains may not sound like much but it equals $1000 – $3000 in profits depending on what you are trading ETF’s, Futures contracts, or CFD’s.

End of the Week Trading Education and Wrap Up:
Overall this week was nothing short of awesome!
The overall market is trying to hold up but sellers continue to pull it lower. Unless there is a strong rally into the close on Friday I figure Monday will gap down because the daily charts are very scary looking. This is what makes the general public panic out as it flushes out the remaining sellers, just before the market makes a sizable bounce and possible rally to new highs.

If you are interested in getting more intraday analysis and setups be sure to join my free newsletter for Day Trading:

Chris Vermeulen
www.TheTechnicalTraders.com