Gold Chart Update

We are seeing lower highs and lower lows for $GOLD and GLD:

022810_GOLD_daily

022810_GLD_daily

Comments

  1. doctorbohica says:

    Chris,

    Thanks for your thoughts on gold. I’m trying to avoid whipsaws and find it difficult with this entity. Do you? Also, on a tangential note, do you have any suggestions on avoiding whipsaws using the New High – New Low indicator?

  2. I believe they call these bull flags.

  3. Chris, When are you coming back on a more regular basis…?? Hope all is going well for you and the family. Your expertise is greatly missed. Janet

  4. Janet,

    Good to hear from you. I will come back and it will be big when it happens. Just not sure on a date at this time. Stay tuned and hang in there.

    Chris

  5. campuzan says:

    Hello,

    I have a question to ask you chris. I saw that the NYSE 52 new high new low difference was deep in the red during the 1999 bull market while NASDAQ 52 new high new low difference was greatly positive. I do not have the raw data for this period and am surprised since the two regularly go the same way.

    Can you confirm that?

    Thanks

    Florian

  6. Hello Chris,

    I miss the great commentary and I hope you do come back bigger and better.

    I have a question regarding how you manage your initial risk when you take a position. Do you always give yourself a 10% stop loss as you often show when you profile a stock?

    Using the position sizing method as outlined in Dr. Tharp’s book allows you to take a bigger position size if you are very close to your stop loss point (such as a key support level or a moving average) but often shakes you out because your stop loss is so close.

    I feel that it may be better to use the position sizing strategy but always just use a stop loss of 8% regardless of where the support level or moving average when you take your position. This way assures that you will always have a smaller position size but decreases the risk of losing 1% of your capital when the stock just moves a little bit against you.

    I would appreciate any thoughts as I am very comfortable with my stock selections but still working on a best method for risk management.

    Thank you.

  7. Jim,

    8% is an arbitrary CANSLIM number that I like to use but isn’t always the correct stop depending on the support levels. A key support level such as the 50-d or 200-d MA could be 5% below the entry which would allow for a larger position with the tighter stop.

    A tighter stop may increase the odds of a forced sale but always remember that the 1% risk loss should always be the max downside. Don’t set a stop too far below an obvious support line just to achieve 8% or 10%.

    Place the stop where it should go, at or slightly below a key support level. Otherwise, use the arbitrary 8% as detailed by William O’Neil.

    Hope this helps.

    -Chris

  8. Florian,

    In parts of June and July of 1999, the NASDAQ was positive while the NYSE was negative or “not as positive”. They both went negative in August, September and October with the NYSE getting very negative. It went positive for the NAS in Nov and Dec while the NYSE stayed negative. So yes, your information is correct.

    They both went and stayed negative in March 2000. Only the NASDAQ was positive in early 2000.

    Chris

  9. How do you feel about trading gold and silver in pairs?

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