Technically the APR'10 GOLD contract is in a BULL TREND posture and has just produced a major technical signal in the direction of the trend. If the market maintains a trade above the 1116.1 Inflection Pivot, look for excuses to get long.
On the SELL side BREAKOUT strategies below 1106.5 are a low probability but valid. Risk little and go for a lot. If the MKT is going to turn sour, it should be quick and relentless. Avoid FADE strategies against the 1125.7 resistance pivot as the MKT has just produced a major buy signal and fresh gains are expected. REVERSAL strategies as well are not recommended, as any resistance level violation that cannot be held is more likely a squeeze for the longs, which can quickly turn positive.
On the BUY side BREAKOUT, FADE and REVERSAL are recommended as the MKT is aggressively bid and all buy signals are valid opportunity. If stopped out at or near the low tic of a reaction and the MKT is not following through to the downside, leverage up using the squeeze low as a stop, expecting a quick reaction back above your original entry. De-leverage unless you have confluence with other indicators or like MKTs. Look for opportunities off 1116.1 and 1106.5. A breach of 1125.7 confirms a higher push.
Note: The MKT has produced a big positive technical signal and should immediately go higher, after at most, one pullback. A laborious trade and the MKT may wait till the end of the session to make its move.
JS
This post supports the Strategy Based Trading, which is a methodology that focuses on the applied strategy verses a specific market. The approach looks to align strategies with markets whose current technical behavior matches the strategies criteria. Please review the following CME sponsored tutorial for a complete overview of this approach.
STRATEGY BASED TRADING Review http://progressive.powerstream.net/008/00102/edu/interactive/js_services/strategy_based_trading/index.html
For more information please contact me at info@jsservices.com. You can also visit http://www.jsservices.com/.The Inflection Pivot levels are available as a chart overlay on the following platforms; Ninja trader, Strategy Runner and eSignal. Sign up for a Complimentary FREE Trial.
