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Dip in Gold Prices, Going Long 2012-11-29

****Update: 2012-12-3; The position described below is no longer open, it was stopped out on Friday, Nov 30. I am looking for re-entry.****

On a dip in gold prices, I have bought gold futures. I bought the June 2013 contract at a price of 1730 at 8:22 this morning. I'll go into my reasoning below.

I have been watching gold futures since the early summer, and have been mentioning them frequently in this blog.

I have been looking for an entry opportunity on cheap prices, and this was it. I would have preferred to enter on the dip that occurred three weeks ago, but alas, I missed that one. I have been waiting for another good dip since, and it occurred yesterday.

I was actually waiting for an MACD divergence to show itself on the 60 minute chart. I Was looking for it to show itself before this morning on lower overnight prices. This did not occur, and I decided to act anyways.

I am quite bullish on gold in the longer term, and although I did not get my preferred entry signal on 60 minute charts, we did still see a solid dip in price. That was enough to warrant my long entry. This is, essentially, a swing trade.

Observe the following daily chart for the June futures contract in gold prices.

gold prices daily futures chart

You can see the dip nearly touched on the blue moving average that I have set. It is below the faster yellow moving average. I would have like to see it get a little closer to the blue moving average, and I would have liked to have bought it closer to the bottom. However, I felt that such an opportunity may not occur.

I have a set a stop. If prices to regress, I will have the option of exiting and re-entering at a more favorable price.

Part of my reasoning to enter this trade even though I didn't get a solid 60 minute signal, was that my bullish sentiment for gold is based on the daily and weekly charts. I was only using 60 minute charts aid me in pinpointing an entry point, and not to determine the overall validity of a trade. In contrast, with natural gas futures I do use 60 minute charts both to pinpoint entry and to determine the existence and validity of a trade.

I plan on holding this long gold futures trade a few months. I'm looking to retest the highs with this one. I do believe that we will see new highs over 1900, but I do not know if we will see them within the life of this June 2012 expiry contract.

In other markets, I have been watching crude oil, the USDX, sugar, and natural gas all fairly closely. I missed a good natural gas trade that I more or less anticipated. Oh well, coulda shoulda woulda. I'm still bullish on sugar, but I'm having a difficult time satisfying myself that the time is right.

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posts listed chronologically below



2013-04-08 Short Natural Gas

2013-03-10 Dollar Index

2013-02-17 Crude Oil

2013-02-11 British Pound

2013-02-03 Gold & Updates

2013-01-21 Gold Trade

2013-01-14 Natural Gas

2013-01-14 Gold Update

2013-01-07 Sugar Trade

2013-01-04 Gold Update

2013-01-03 Natural Gas

2012-12-28 Gold Prices

2012-12-26 Natural Gas

2012-12-24 Updates

2012-12-12 Sugar Trade

2012-12-06 Dog Video

2012-12-06 Gold Re-entry

2012-12-05 Natural Gas Update

2012-12-04 Natural Gas

2012-11-29 Gold

2012-11-19 Updates

2012-11-06 Natural Gas

2012-11-01 Natural Gas

2012-10-28 Gold Futures

2012-10-23 Natural Gas

2012-10-22 Sugar, Re-entry

2012-10-18 Sugar

2012-10-17 USDX, Sugar, Gas

2012-10-15 Natural Gas Futures

2012-10-12 Natural Gas Update

2012-10-10 Natural Gas

2012-10-04 Sugar Exit

2012-10-01 Sugar Update

2012-09-25 Natural Gas, Sugar update

2012-09-20 Sugar

2012-09-20 Natural Gas

2012-09-12 Canadian Dollar

2012-09-11 USDX

2012-09-10 Natural Gas

2012-09-09 Natural Gas, DX, GC, SB

2012-09-05 Sugar Futures

2012-09-04 Canadian Dollar

2012-09-01 Gold, Dollar Index

2012-08-24 USDX, Sugar, Gold

2012-08-19 TRADE Sugar

2012-08-16 TRADE Sugar

2012-08-12 10yr T-Notes

2012-07-30 TRADE: AUD/USD

2012-07-23 TRADE: USDX

2012-07-18 TRADE: US Dollar Index

2012-07-17 TRADE: AUD/USD

2012-07-15 10 Year Treasuries

2012-07-06 Sugar Futures

2012-07-02 TRADE: Australian Dollar Futures

2012-06-27 TRADE: Sugar Futures

2012-06-25 TRADE: US Dollar

2012-06-22 TRADE: US Dollar

2012-06-21 TRADE: Gold, Sugar

2012-06-18 More on Gold

2012-06-12 Gold Update

2012-06-12 TRADE: Dollar Index

2012-06-11 TRADE: US Dollar

2012-06-07 TRADE: Gold

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