Method To My Madness

As summer fatigue sets in I deem it to be my duty to once again remind my steel rats that there are always great setups abound. Well, not always but quite often. That is of course if you are able to free yourself from only trading your three favorite stocks or index ETFs.

Case in point is this setup on gold this morning, which I suggested yesterday but was primed and ready to fly an hour or so before the NYSE opened. I went as far as sending our a friendly reminder email to all my subs to make sure everyone was ready to catch this bus.

Not sure how many actually paid attention but if you did then you’re enjoying a nice helping of good old fashioned easy money. But wait – there is more. As the title of this post suggests – there is method to my madness.

You see, we just happened to have failed a 100-day SMA break out. Or at least it’s pretending to fail and is trying to pull in a few hapless gold bears. Should you care? No, you should not because you got a prime entry right at the 100-day SMA, which roughly coincided with NLSL trigger this morning (you actually got it at 1617 – three handles above that SMA).

What this means is that you just got a great entry at an inflection point. If she continues lower then there’s nothing for you to do. If she pops back up and breaches the 100-day SMA then you are able to flip this trade with a handle or two of profits. Odds are that a push higher thereafter will go all the way. Being a stainless steel rat does have its advantages, unfortunately dental hygiene is not one of them.

If you are a sub then I also hope that you took a sugar sweet long at the 100-day SMA touch this morning. Yesterday’s treatment on the 100-day SMA sprint strongly suggested a great long setup as this seems to become a new Olympic discipline.

EUR/USD – it took two attempts but thus far the NLBL entry seems good to go. I’d feel better if she took off higher but at this point I suggest to keep your stop in place and forget about this one for a while.

And then there was cable – which tried to fake us out yesterday. But today’s early morning entry seems to be good to go and again there’s nothing to do here until we get closer to target or out stop is hit.

A few more goodies for my intrepid subs – FOMC day be damned.
[amprotect=nonmember] More charts and cynical commentary below for anyone donning a secret decoder ring. If you are interested in becoming a Gold member then don’t waste time and sign up here. And if you are a Zero or Geronimo subscriber it includes access to all Gold posts, so you actually get double the bang for your buck.
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AUD/JPY – almost touched its old NLBL and now it’s back above the 100-day SMA. I am waiting for a break out here.

EUR/CAD – not sure if this is really a floor but we have an inside day + NR4 combo here. If it stays in place then we’ll have a great entry level tomorrow. Mostly interested in a long setup here but I would also take a small short.

Copper right at its NLSL. Careful here as this was a long candle down. May take some finesse – look it up.

10-year treasury futures – somewhat of an inside day setup. I’m saying that because today and yesterday’s lows are equal. Not sure what the rule is there but I think it’s worthwhile playing either direction.

It’s an FOMC day – keep it frosty and if you’re not comfortable trading then just stay away. We have a few goodies in the running and there’s no sense in pushing our luck.
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Cheers,