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Robert Edwards
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Contrarian daytrading technician who specializes in micro scalping of stocks (using 1 minute bar charts), swing trading of stocks overnight, weekly stock option premium selling, pre-market and post-market psuedo market maker and stealth trading activity, and selling commodity option strangles... More
  • Can I Perfectly Call A Bottom Again In Gold? 4 comments
    Jul 7, 2013 12:17 AM | about stocks: GLD

    Just before midnight on 6/27/13 after just watching August Gold trade down to just under 1180 and then move back above 1200, I called a bottom in gold and wrote an article to go long gold on Friday 6/28/13 that you can read here. If you read the comments section of that article you will see that on 7/1/13, I got out on the $82 rally and was looking for a retest to something close to 1200 again. Well, on Friday we got down to 1207.40 and closed 1212.70, so I bought again at 1208.80 (very, very, small position) and sold out half at 1220 late in the day.

    Some were saying to put in stops at 1225 and trying to hold long for higher prices. I was convinced the negative sentiment was so strong that 1225 stops would for sure be violated. It was. So now what?

    50/50 chance the low of 1180 holds

    When we made a low of 1321 in April (June Gold contract), the first time it was retested, it held. I feel that there is at least a 50/50 chance we hold above 1180 on the first retest, and we might even have a low just above or slightly below 1200 Sunday night. Some are saying because not all the traders were back from holiday on Friday, selling will resume in earnest Sunday night, but I don't believe we will be that weak. As I mentioned in my last article, one must play very small and be able to hold through a move to 1000, as it may require doing so if one gets long around 1200. Play so small that you can hold through a 200 dollar further sell-off and you should be fine catching this falling knife. Another important bottom, mentioned by Ms. Louise Yamada on Fast Money Friday (click here for video), is 1155. I will be buying more should we hit 1155 and again at 1120. I do not see us moving below 1110 to 1125 in the short term, without first retesting 1300 to 1325. I like the contrarian gold call on Friday of Carter Worth (check out video here). Carter is now calling for a bottom in gold and I am impressed with that call since the last two calls he made were very timely sell or short gold calls that turned out to be right on the money. Carter Worth mentions how we are too far below the 100 day moving average and need to correct back up. Could the sentiment be any more negative? Whereas it was scary buying gold in the 1300s in April, I am fearless buying gold at 1220 and below, and will relish the opportunity to buy in the 1160 area or lower, because if we do break the 1180 support area, the next countertrend rally should be 150 dollars back up, similar to the 166 dollar rally we got after the April smackdown. By Wednesday of this coming week, I will be looking to get aggressively long gold. Any damage the bears can muster should be exhausted by the end of Tuesday's trade, and possibly much sooner. I will be playing very small and enjoying the bounce!

    Stocks: GLD
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  • Robert Edwards
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    Author’s reply » Something that I did not mention is that the dollar really rallied on Friday thanks to a big smackdown in the Euro. The Euro, the Yen, the Canadian Dollar and the Australian Dollar are all near some significant support areas so I am looking for a short-term top in the dollar by midweek which should support the metals by midweek. The taper talk is way overdone and Friday's big move on just a slightly stronger than expected jobs number appears to be way overdone. All the Johnnie-come-lately traders who went long the dollar on Friday and short gold and the Aussie Dollar, should regret it very soon.
    7 Jul 2013, 12:29 AM Reply Like
  • Robert Edwards
    , contributor
    Comments (587) | Send Message
     
    Author’s reply » Went long gold during day session and just took last contract off above 1250 this evening. I was correct in being bullish on the 1200 retest and am very pleased to have gotten long for a nice profitable ride today, even though I played very small because again I have to realize that gold can fall 200 dollars any time it wants to.
    8 Jul 2013, 10:56 PM Reply Like
  • Robert Edwards
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    Comments (587) | Send Message
     
    Author’s reply » Here it is Tuesday afternoon and I hear minutes revealed tomorrow and Bernanke speaks. Bernanke kills gold market whenever he speaks or there is any rate decision or minutes etc. Bought gold 1247 down to 1243 when gold dipped to 1242 and then took profits ave. price of 1248 when gold rallied to 1250 few minutes ago, as I caught Bernanke will get to influence markets on Wedn.
    9 Jul 2013, 03:45 PM Reply Like
  • Robert Edwards
    , contributor
    Comments (587) | Send Message
     
    Author’s reply » Looks like Bernanke comments will support gold for short term. Should bounce to 1300 and then to 1350 area before we turn back down. Buying any dips 1281 and lower, and taking profits on surges higher. Feel very comfortable buying anything with a 12 handle as 1300 plus is now in the cards for almost certainty. Hit 1297 overnight so bought 1280 this morning. Few days ago kept buying anything under 1250, but now feel very good buying anything under 1280.
    11 Jul 2013, 07:02 AM Reply Like
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