- MKT sentiment is leaning negative and will outweigh the buy side if the integrity of the previous session high remains intact.
- On the SELL side accept BREAKOUT, FADE and REVERSAL strategies with the expectation that the current negative transition will continue. Keep aggressive position management on DP BREAKOUT strategies as the MKT is still in the neutral zone and has yet to commit to a new trend. A more conservative strategy would be to wait for positive reactions after a negative signal to FADE the DIR.
- On the BUY side avoid DP FADE strategies until after the previous session high point has been taken out. Until then, a better opportunity will be a DP REVERSAL strategy. The idea is that the transition trade is over and a positive shift back into a NEUTRAL DIGESTION is expected. UP BREAKOUT strategies can be profitable but they are aggressive. Risk less, go for more
Today's PRICE MAP Performance for GC
- With a NEUTRAL DIGESTION TRANSITION Market State, the GOLD futures market is in a Neutral Primary state; however, the market is "in play" and today's session may be the start of a new move. The R Level is above the market at the UP signaling traders to accept SELL strategies. The market building negative structure throughout the morning session serves as our first "tell". Around 6 am, the market gives us a SELL DP BREAKOUT strategy that is in line with out sentiment bias. In these NON-TRENDING market states, it is critical to look at momentum oscillators for "clues" during the session. The indicator that I have included is the 14-period RSI. The red circles represent NEGATIVE REVERSALS in the RSI indicator. In essence, the market is "more oversold" at LOWER price levels, representing weakness and thus, confirming out short position.
