|
|
| |
|
 September 18, 2005 Commentary (weekend
edition)-
I had some fun last night in the parking lot
of the post office. There is one branch that stays open until 8 PM, and I spent
my Friday night trying to get all the new Kane Trading on: Median Line and
Fibonacci Synergy books out to those that ordered them. The printer did
come through for me, after a scare where they ran them all incorrectly and had
to redo them. They stayed on schedule, and I was able to pick them up on time.
This leads to my Friday night at the post office story.
Since I am
such a quality freak, I hand leaf through every page of every book I ship out,
to make sure all is in order. I've done this on every book I have shipped,
since the first one went out. That way I know exactly what I am sending, and
that it meets my personal standard. This takes a lot of time, and I rarely find
mistakes, but yet I still do it. Everyone says to just ship them, and if a
mistake is reported, send out a correction page or whatever. I prefer to make
sure it's right before it goes out.
So, given I had a lot of preorders for
this last book, from those previous full set buyers who ordered the two new
books as a split shipment, to the full set buyers that ordered in the meantime,
with delivery of this last one upon completion. With the book at almost three
hundred pages, imagine hand leafing through endless copies until each and every
one was verified before putting them into their shipping envelopes and boxes.
It was thousands and thousands of pages. By the time I was done, I could barely
move my fingers. It's things like this that make me the unique character that I
am.
Both the new books are now fully released and shipping at this
point. Everything is done except excerpts for the books, which I probably won't
do for a while. The new book set package is up, and will ship in full at this
point. I'm finally done, and getting back to my life, which is well deserved.
I've never been happier with a piece of work in my entire life, and I've been
getting charts all week from members about the new patterns in Kane Trading on: Four 'New' ABCD Pattern
Variations. That's what makes it all worthwhile for me.
Let's move on
to some charts. I'll start with NEM.
This is where it gets tough for me to try to
explain what I was watching for an entire week or more, after the fact. I cover
a lot of this on a daily basis in the members' area, and sometimes
that's not even close to enough. Things can develop quickly, and I 'read' the
action all the time, based on things that unfold on the lower timeframes and in
the market in general.
I feel like I may get myself into trouble here, making
things murky instead of clear. I'll take a shot anyway, so keep in mind this is
a framework, and that I covered a lot of this step-by-step, in advance, in the
members' area.
NEM came right up to my upper line and rolled right off my
grouping. I was already playing long off the reversal at the sliding // by the
second last arrow. I was watching here to see how it reacted. Based on the
bigger 'context' and larger weekly pattern, and the dynamics I had been so
closely following in my intermarket analysis in treasuries, currencies, energy,
and so on, I was expecting the 'breakout' moves to the upside at any
time.
The currencies told me the likelihood was going to be this time. I
wanted to see if they picked NEM up at that sliding // area, or the division
line right there (not shown), or perhaps near the big ML upper // and smaller
set ML intersection. As far as management, I was not going to do anything until
after a failure at the last spot. Even then, I only moved my stop up a bit, so
I was willing to take some heat. I followed the plan I laid out in Kane Trading on: Trade
Management.
NEM hit the sliding //, and couldn't even get down to a
.236 retracement. That's strong. Then they came in big time, and it's been
ramping straight up ever since. This was a clear add-on spot, or even a new
entry spot. Recall my comments about the weekly NEM chart. I discussed this in
advance in the members' section. I have been following the gold's very, very
closely based on my intermarket analysis. I usually follow them, but to nowhere
near this extent.
Let's look at GLG.
The first of the three arrows on the upper
right hand part of the chart shows where my latest long setup came together.
Look over NEM, ABX, and the XAU and see their positioning at this time. GLG hit
the 'adjusted' ML upper //, and then dropped to the ML and .382 area, where
they came in. This gave me a clue about NEM. Again, look at the XAU at this
point. GLG has since 'broken out', and closed at an all-time new high. I
discussed this in advance in the members' section. I also left something on the
chart that I added back on from my previous setup, for the new book. It was
just too pretty for me to delete back off.
Let's look at the XAU weekly
chart.
I am not going to say much here except that
now you can see the larger pattern that is driving this run up. There was a
monster ABCD pattern on the weekly chart, and the gold's are just running off
that. This is where my 'context' is coming from, and why I was leaning on the
long side. Combine this with what I consider compelling fundamental and
intermarket 'context', and why I have been leaning on the gold's is apparent.
Of course this is a really, really cursory overview, but it lays out a small
part of what I covered in the members' area.
Let's look at the Euro. This is
where it gets even more difficult on me.
Here's the Euro chart. Next time I'll roll
out to the current front month of December. I had a lot of lines there to
support that ML lower //. But this wasn't a long potential trade area for me. I
showed this in Jim's Chart of the Week, where I can't do any discussion on what
I am looking to do. In the members' area I discussed, in advance, that this
looks like an Elliot abcde correction, and that at the very least, based
on the layout of the dollar index, I expect this to break though this time. It
did, exactly as I suspected.
It may now be 'testing' this area from below. I had a
lot of information going into my assessment at this point, especially in
treasuries and gold. A setup is not just a setup, in the sense that I just
trade every PTA equally. They are 'action spots'. I trade some, fade some, and
stand aside on some. Some I straddle with options, or do ratio backspreads
(depending on my premise). Price action, 'context', my assessment of multiple
things, it all plays into this. Now I see what the Euro does here, as
everything related seems to be hitting key areas.
Let's look at the dollar
index.
The dollar formed an awesome 5-point pattern
at a 1.272 external retracement. I have just the framework here, and there is
so much more on my working chart it is just jammed full. I have some possible
Elliot counts on there, but they are just guidelines, and I play my setups, not
Elliot counts. Look at the Euro and this layout, and the gold's. Pull up the 10
and 30-year treasuries, and look at those. Then pull up crude, and maybe
unleaded gasoline. The money flow is obvious, at least to me. I spend a lot of
time watching the money flow.
The dollar is right at a key area, perhaps
taking out all those key lines and that .382 retracement area. What it does
here, and what the Euro does with its 'test', and how the gold's react, and how
the treasuries act in their respective areas, and how energy acts, it all ties
together, and is a road map of the money flow. All this, as they move into
stocks. The money flows from area to area to area, and I find that the flow
frequently shifts right at areas I am watching. With my 'context' added in, I
seem to have a good idea where the flow will change, and where it will break
over the banks and keep flowing ahead. That's what I am trying to show
here.
This is just a very brief overview of one small aspect of what I am
watching on a daily basis, and discussing in the members' section. I hope is
doesn't draw too many questions relating to total and utter confusion, or I
will have to go back to my cautious mode about what I show in here. I hope this
clears up some ideas, and as opposed to muddying the waters. It's amazing how
difficult it is in a venue like this to show material of this nature, and yet
how simple it seems when I do it one-on-one.
The next commentary will be next
weekend's edition, posted by Sunday evening, September 25, 2005.
|
|
|
| |
|
|
 NOTE: Reading this page or
any page on the Kane Trading website, or utilizing this website and any
material
contained herein in any way, shall constitute an
acknowledgment that you have read, understood and agreed
to all
the disclaimers,
terms & conditions, and
policies of this site.
|
|
|
This
website is best viewed with MSIE 6.0, text size set to medium, and screen
resolution set to 1024 by 768.
Copyright
© 2005 Kane Trading. All rights reserved.
|
|
