Swing Trading and Market Timing Knowledgebase

By: John Crane, swing trading guru

Reaction Swing Gold Trade

Figure # 6.5 - A four-day Reaction swing formed between June 6 (C) and June 9 (D) with a pivot high at $429.50. Gold reacted quickly after the June 9 low and traded above $429.50 the next day.

1-Day one – June 10 – The Breakout bar - The futures market rallied off the low and traded above the pivot high trigger price $429.50 (C) to confirm the buy signal. However, the Gold closed at $429.30, slightly below the entry.

2-Day two – June 13 – The daily low was $427.60 and the close was $431.10, well above the pivot high.

3-Day three – June 14 – Gold had a quiet day with a small trading range and finished as an inside day and above the breakout point at (C).

After the one-day pause on June 14, Gold surged forward and continued the upward trend until it peaked at $444.20…$14.70 above the breakout price at (C).

 

gold trade
Figure # 6.5 – August 2005 Gold

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**THE RISK OF LOSS IN TRADING CAN BE SUBSTANTIAL. YOU SHOULD, THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER OR OVER-COMPENSATED FOR THE IMPACT IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT.NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES.

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