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Paul Mosgovoy
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Market Masters: Livermore, Wyckoff and Loeb
  • Randgold: Testing The Trading Range 0 comments
    Mar 2, 2014 8:48 AM | about stocks: GOLD

    In our previous update, we indicated that Randgold Resources Limited (NASDAQ:GOLD) was poised for a breakout.

    As of Friday's close (2/28/14), GOLD is testing the current trading range that would allow for a move higher.

    In Wyckoff's 1930 autobiography, he discusses an interview that he conducted with Jesse Livermore. In that interview, Livermore reveals that he takes a position (in a stock or commodity) when price action has reached the "danger point"1.

    As far as we can ascertain from researching market publications that date back to 1907, it was Livermore that is on record as first using the term.

    The danger point is the technical position of a stock where it can go either way, up or down.

    It is where if one is wrong on the direction, the potential loss is small.

    That is where GOLD may be at this point. The bottom of the trading range is being tested but price action has not yet moved higher or lower.

    (click to enlarge)GOLD Daily

    Charts by TeleChart

    1: Wyckoff: Wall Street Ventured & Adventures Through Forty Years, pp. 256, ISBN: 0-934380-13-9

    Disclosure: I am long GOLD.

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