shadowtrader "fudging" a stop

12/18 The ShadowTraderPro Model Portfolio's long position in gold (GLD) was hit hard yesterday with higher volume selling pressure throughout the day. Price is now around the 61.8% Fibonacci level that was our original entry price. With our stop just below it at 106.00, it does not make a lot of sense for us to exit the trade now.


















Trade Review: 12/10 advisory

12/10 Good morning, traders. Like the stock market of late, gold is also very much tied to the movement of the U.S. Dollar, but it has also been a very crowded trade recently. Yesterday the Gold ETF (GLD) touched the 50% Fibonacci Retracement level we discussed in a recent ShadowTraderPro Swing Trader, however we concluded during trading hours yesterday that it has a very good chance of coming all the way down to the 61.8% level so we deferred entering the ETF long. Today we are going to discuss exactly how we will play the gold trade. Please observe the split chart of the Gold Futures GC and the Gold ETF (GLD) below.

We plan to use GC (left chart) to trigger our long entry in GLD (right chart) because GC, like spot gold, GC trades around the clock as opposed to GLD which is an ETF and only trades during stock market hours.

We have drawn the Fibonacci Retracement study on both charts. We will be buyers of GLD if GC touches the 61.8% level today. A potential scenario that needs special attention is the chance that GC touches the 61.8% Fib level anytime between last night's stock market close and this mornings stock market open. If this occurs, the plan is then to buy GLD at the open with a stop under the low made by the first 15 minute GLD price bar.

For those that just want to play GLD based on it's price action alone, we have noted the entry price range (blue box) around the 61.8% level on the GLD chart and also listed it in the Bulls and Bears section below.

If you don't pull in weeds, you aren't fishing for bass

by Peter Reznicek / ShadowTraderPro SwingTrader

Good morning, traders. There is an old saying amongst those who enjoy Bass fishing. If you don't pull in weeds on some casts, then you aren't fishing for Bass. In many respects, the same could be said for swing trading. We cast our line toward set ups that we know work much of the time, but inevitably some trades will not go as planned and we will pull in a clump of weeds.

The larger premarket gaps that seem to be happening on a daily basis makes it feel like we are fishing for Bass not in a lake, but in a weed laden swamp. However, this does not change the fact that at the end of the day, our trading results are the product of our own decision making.

So what are the things we can do to help ourselves if we choose to continue to fish in the weedy swamp instead of waiting for the Bass to move to a more fishing friendly lake? First, we must continue to cast our line toward carefully selected trades. Nightly scans are always very important, but they are especially important in conditions such as these where thorough investigation of set ups is key.

But as thorough as one might be in researching a chart set up, it might not be enough to avoid getting snagged. So instead of beating our heads against the side of the boat, the second thing we can do to avoid excessive damage to our trading capital is to reduce our position size until conditions become more favorable.

We have received a few emails asking when we think this chop will end. Our answer is...it will end when it ends, which leads us to the third thing we can do until the chop ends. Lock in gains when you have them instead of hoping for some kind of trend to take the stock higher. With gaps happening every other night, profits are valuable, so adjust by tightening stops on profitable trades and allowing yourself to take profits earlier than you would otherwise.

overnight stop orders on TOS must be set uo this way

You must set it to STOP MARK and not STOP STD. Stop mark stays at the TOS servers, and when the time constraint gets triggered, it sends a market order if the stop is marked at or below your stop price.

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