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Selling Gold

Buying gold, gold exchange traded funds, and gold futures have all allowed traders to ride the bull market on gold to a more than eight fold increase in the last dozen years. However it is in selling gold that the profit lies. Gold is no longer coin of the realm so if you need money for remodeling your new home, travel, paying for a college education or two, or simply investing in stock, bonds, or real estate, selling gold is necessary to pay the bill. Long term investing in gold has proven to be profitable if the term is not too long. For example, after the Nixon administration took the US off of the gold standard in 1971 the price of gold rose from $32 an ounce to over $600 an ounce by early 1980. The right time for selling gold was, in retrospect, early 1980 before market sentiment changed and gold fell into the $200 an ounce range where it remained for twenty years. Many who used sound fundamental analysis as well as technical analysis tools like Candlestick charts were able to profit by accurate anticipation of the end of the gold bull market of the 1970s. How about buying and selling gold now? Has the bull market run its course of is there more to come? Where do both fundamental and technical analysis come into the picture?

There is no magic crystal ball to tell us if gold will resume its meteoric rise of the last years. Gold bugs have predicted not only $2,000 an ounce gold but $3,000 an ounce gold. These predictions are based on the assumption that world economies, especially those of Europe and North America, will be unable to stem the flow of red ink, balance their budgets, and stimulate their economies back into steady growth. Buying gold is done with currency and in selling gold one receives currency. For many, investing in gold is a bullish play on currency trading. Rather than trading currencies, one versus the other, one trades a commodity, gold, typically versus the dollar. The problem with gold is that it does not produce a dividend yield like dividend paying stocks do or interest like bonds or a savings account. On the other hands short term traders can profit whether gold, gold futures, oil, oil futures, stocks, stock futures, or stock options go up or down.

Traders need to keep an eye on the fundamentals of buying and selling gold but traders know that the markets quickly discount fundamentals. Periods of economic uncertainty lead to market volatility. Market trends turn around in market reversal. With time honored tools such as the easy to read signals of Candlestick analysis traders can anticipate market turnarounds and profit from both buying and selling gold. In fact, there was more money to be made in the last years by buying and selling gold at the right times than by holding gold bullion purchased at the beginning of the bull market. With the use of Candlestick patterns and Candlestick trading tactics traders can successfully anticipate movement in any market and profit thereby.

Market Direction: When the Japanese Rice traders profess to let the market tell you what the market is doing, it is because the market has characteristics built into trading trends that allow the candlestick investor to have a much more clear understanding of what the trend is doing. This is even during times when the trend is not real clear to most investors. For example, over the past six or eight weeks the market has been volatile in the sense that it would have for five days to the upside followed by 45 days to the downside and that same process repeated five times. Many investors would not know what to expect from this type of market action. Some very simple visual evidence allows a candlestick investor to know exactly what is going to occur in the near future.


Members, The daily chat room is for the benefit of the members to learn and apply candlestick analysis. It is also a forum for resolving investment problems you may be having. Please use the forum to ask questions or get clarification on how to use candlesticks effectively. If you have investment problems, do not hesitate to private message Steve. Profitable investing not only includes learning and utilizing a successful trading method but also controlling your own human emotions while investing your funds. Any questions in regards to candlestick signals and patterns are just as relevant as questions about how you overcome some of your personal investment hangups. More than likely, the question you have is a question that many other participants need answered.

Additionally, a number of chat room forum members have requested more details on entry and exit points for the positions Steve has taken. He will be making himself more available in the chat room each day. There will be much more detail in when and why positions are entered or closed. This change was made by a suggestion from one of the members. If you have suggestions about improving the educational process of the chat room, all suggestions are welcome.

Chat session tonight at 8 PM ET, Everyone is welcome!

Good Investing,


The Candlestick Forum Team

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