During the last couple weeks the SP500 index has been taking a beating leaving many traders left holding the bag at high prices.
Fortunately, I cover several different investments so we when one is not giving us a trade, another one should be.
Taking a look at the technical analyst trading charts below you will see how a simple reversal candle coupled with volume can generate low risk and highly effective trades that move in your favor quickly.
If you want to learn how to read and trade the charts like a pro, be sure to join my daily video analysis newsletter which is jam packed with trading education and tradable ideas each day.
http://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.png00adminhttp://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.pngadmin2013-08-29 10:33:562014-03-04 14:50:05Member’s Pocketed 5% on Natural Gas Bounce with Signature Candle & Volume Pattern
Commodities and stocks have been on fire the past two weeks and I think it just may be time for things to take a breather. While I continue to stay long, taking some money off the table to lock in profits is a safe play.
Just from a quick glance at the charts we can tell the odds are pointing to some type of pause or pullback in the coming days. I figure any day now we could see some profit taking.
Gold ETF Trading – GLD
The Gold ETF is one of my favorite trading vehicles. Using simple trend lines and looking at the recent price action you can see that the price of gold is looking ready for a pullback. Buying at this level is chasing and that generally means you buy at the high and panic out at the low.
How to Trade Gold GLD
Silver ETF Trading – SLV
The Silver ETF looks to be in the same boat as gold. I expect to see some sideways price action or a pullback.
How to Trade Silver SLV ETF
Natural Gas ETF Trading – UNG
The Natural Gas ETF sure has given everyone a wild ride in the past 6 months. The bear market is still in place which can be seen on the daily chart. So far this week the price has broken down and trading at the $11 support level. This fund could generate a buy or sell signal with my trading model in the coming days so I am waiting for a clear entry and exit point before jumping on the gas wagon.
How to Trade Natural Gas UNG ETF
Crude Oil ETF Trading – USO
The Crude Oil ETF has broken above its resistance trend line this week but still struggling to move above the August high. Volume is declining while the price rises which is a bearish indicator. USO looks ready for some type of a pullback as it digests this breakout before moving higher.
How to Trade Crude Oil USO ETF
Mid-Week GLD, SLV, UNG, USO ETF Trading Report
What does the general public hear and think about the stock market?
From recent emails, local financial news shows, family, friends etc… all I am hearing is how strong the market is. Indexes are making new yearly highs and company earnings are better than expected this quarter. Sounds like all we need to do is buy and life will be great!
Well in my opinion the market is the perfect tool for misguiding and frustrating the general public. All my indicators are telling me we need more of a correction before rallying much higher. The market (smart money) generally anticipates good and bad news several weeks if not a month in advance. So the question is:
Are company earnings already priced into the market?
Is all this positive market coverage getting the general public to buy up here at this possible market top?
The answer is, only time will tell. No one knows for sure what the market is going to do but short term moves can be predicted with relatively high accuracy.
Don’t get me wrong, I am still bullish on the market but with all this good news becoming public information you have to wonder what is next. I am still long the market but trimming my positions to lock in profits and still stay in the game.
Commodities have and continue to be a fantastic trading vehicle for those who can stomach volatility. After last year’s market crash most commodities pulled back to normal if not lower than normal trading ranges. This allowed us to enter the market at 10+ year lows for natural gas.
If we look at the weekly chart for gold, silver, oil, natural gas and the CRB commodity index we can see that commodities in general look ready to skyrocket higher approximately 34% on average in the next 4-12 months.
Take a looks at this chart of gold. While this chart shows the basic technical analysis of the price of gold you can see the completion of the Cup & Handle pattern which is VERY BULLISH. Also you can see gold broke to a new high. While I don’t like to trade new highs it’s hard not to want to buy into this breakout. Most traders should be long gold already, but if you are not, you have a couple of options. Buy into this breakout with a tight stop or wait for a pullback and buy on a test of the breakout. Personally I am waiting for a pullback (test of breakout) before I add more to my position.
Trade Spot Gold
Silver has been strong but has not held up its value as well as its big sister (gold). As you can see silver must break through two more major resistance levels before making a new multi year high. Overall silver still looks strong and I will be waiting for a low risk setup for us to add more to our positions.
Trade Spot Silver
Crude Oil looks like a perfect Cup & Handle pattern and I am now looking for a low risk entry point which should form before we get a breakout it to the up side. I can see oil quickly moving to the $100 per barrel level once we get a breakout.
Trade Crude Oil
Natural Gas had a perfect shakeout in August and many aggressive traders who follow these reports followed my lead and bought natural gas around $2.90 (10 year lows). This was the move I wrote about for nearly 3 months as we waited for it to unfold. Down side risk was around 15% so it was not my signature low risk setup but this rally has been exciting. Currently natural gas is trading at resistance and taking some money off the table is a great play here. You will never go broke taking profits.
Trade Natural Gas
The CRB Index looks very similar to crude oil. Overall commodities look to be in the final stages of basing (bottoming) and from simple technical analysis the next more could be around 30-34%.
CRB Index
Commodity Trading Conclusion:
Overall commodities look like a great buy. We are seeing precious metals moving up strongly and gold making a new high which is very exciting as our golden rock stock plays push higher and our commodity ETF play continue higher as well.
Energy is a mixed bag. Oil looks bullish and ready for a nice rally, while natural gas looks a little top heavy as it trades just under resistance.
We continue to stay in the market and are waiting for another round of low risk setups which could happen in the next few days if we get favorable price action. Remember to move your stops up to lock in gains. There is nothing worse than giving back a large portion of your profits when you don’t need to.
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Chris Vermeulen
http://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.png00adminhttp://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.pngadmin2009-10-07 23:22:322014-03-10 10:54:51Oil, Gas, Silver Gold – Getting Ready for Next Rally
How to trade hot commodities like natural gas, oil and gold – We should see big moves in the coming weeks as gas bottoms, and oil & gold breakout or breakdown. A lot of money is going to be exchanging hands quickly and the key is to be on the receiving end of things. Below are some charts showing where these commodities are trading.
How to Trade Gold – Weekly Chart
How I trade gold is relatively straight forward. I use a simple trading model which allows me to identify the down side risk for a potential gold trade. I also use the same model for trading oil, gas and silver.
Beyond finding good entry points, it is crucial to know when to take some profits off the table. The weekly gold chart clearly shows gold trading at a resistance level which means there are going to be more sellers than buyers, hence the reason it is called resistance?.
To trade gold I enter with my low risk entry points and sell half my position once I reach a resistance level. Today for example gold moved up into this long term resistance level and then started to head south. We took some profits off the table before gold dipped in the late afternoon for a healthy gain. Taking profits is a must or you’ll simply hold onto winning positions until they eventually turn into a loser.
Gold Newsletter
How to Trade Crude Oil – Weekly Chart
Trading crude oil is exciting because it moves much faster than gold. How to trade crude oil with low risk can be done by using my simple trading model which is a combination of indicators like momentum, support & resistance, volume, price patterns and media coverage. All these things combined allow for highly accurate trades with minimal down side risk.
Crude oil looks ready to make a big move. The odds are pointing to higher prices because oil has a multi month bullish price action and the falling US dollar helps increase the price of oil. I can see oil breakout and rally into the $95 per barrel level if things go that way in the coming weeks.
How To Trade Crude Oil Breakout
How to Trade Oil (USO Fund) – Weekly Chart
USO tracks similarly to the price of crude oil and it provides some great trades for both swing traders and day traders. I focus on trades that bounce off support with low downside risks, which occur on both the daily and weekly charts.
How to Trade Oil
How to Trade Natural Gas – Weekly Chart
Natural gas is looking ready to bottom here. If you go back to the early 90’s the $2-3 range is a major support level. While I don’t generally try to pick bottoms, there are some signature price patterns and volume patterns that have proven to be very profitable for catching sharp bounces.
How to trade Natural Gas
How to Trade Natural Gas – Daily Chart
The daily chart shows a perfect waterfall sell off with the price of natural gas dropping to a long term support level. This pattern combination shows panic selling which indicates a short term bottom is close.
The extreme panic selling and sharp decline in price, removes much of the down side risk. Scaling into a position over a few days, if the price continues to move lower, is important for this strategy to work its magic.
The black horizontal lines show my resistance levels for taking profits. If the price were to drop below $10 then I would exit the second half of the position to lock in the rest of the profit.
How to Trade UNG
How to Trade Commodities Conclusion:
Trading commodities is very simple with all the ETF’s and funds available. The energy funds like oil and gas have some issues with following the prices of their underlying commodity but I do not find it a problem with my style of trading.
I would really like to know the entire story about what is going on with the oil and nat gas funds which have crazy contango issues??? Why do other commodity funds like GLD (gold bullion) and SLV (silver bullion) not have these issues?? Why can’t they make a fund which follows oil and gas properly? All I know is that there are a lot of dishonest people in the financial industry taking honest hard working peoples money.
If you would like to receive my free weekly trading reports visit this webpage to join my newsletter: www.GoldAndOilGuy.com
Chris Vermeulen
http://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.png00adminhttp://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.pngadmin2009-09-09 20:16:442014-03-10 11:11:30How to Trade Gold, Natural Gas & Crude Oil ETF Funds