Ever since we exited our Short Gold position for our best trade of the year, we’ve been anticipating if and when it might trigger again, and have perhaps been guilty of assuming it would be to the long side. One of the key disciplines of trend following is to remove any bias so you can take whatever signal the market provides with equal conviction. So while we might be guilty of assuming it would be a long signal, we are ably demonstrating we are not bulls or bears or bugs, we are trend followers, and we will enter long without hesitation at tonight’s open.
Going in to Friday this leaves us SHORT 30yr, Dollar, and LONG S&P, NASDAQ, Euro, Oil, Gold.
Long Gold ($GC_F) 8/16 +$0.00 per contract
The advance from the lows met with resistance at the descending trendline and 50-day MA but recovered strongly from support around $1273. In the last week it reclaimed ground above the 20 and 50-day, which also had a cross of their own, going on to establish a new sequence of higher lows. Consolidating just below major resistance in the $1352-58 range gave us warning it was likely to trigger, and today’s move gave us a strong confirmation.
Our futures signals are proprietary so we can’t pinpoint an exact price that would trigger an exit, but for position sizing purposes it’s clear a break of the ascending trendline from the lows would be the first sign of trouble, and a break back below $1281.50-$1273.40 support would signal the longer-term downtrend was likely resuming.
Our current open positions are as follows:-
Long S&P ($ES_F) 7/18 -$1,025.00 per contract
Long NASDAQ ($NQ_F) 7/18 -$40.00 per contract
Short 30yr ($ZB_F) 5/13 +$11,812.50 per contract
Short Dollar ($DX_F) 7/23 +$1,080.00 per contract
Long Euro ($6E_F) 7/22 +$2,675.00 per contract
Long Crude Oil ($CL_F) 7/5 +$6,090.00 per contract