Gold in a Range

For the past week Gold has been trading in the range between $1,080 (Weekly low) and $1,104.98 (Weekly high). Current Gold price is near the weekly bottom and the yellow metal is now trading at $1,081/oz. Not much has happened that can stir the market and Gold lost some of its shine, due to low volumes and a lack of liquidity, but it is still keeping a steady position near the support of $1,080.

If this level is broken the next level of support would be $1,067. If the bulls take a hold of the situation the precious metal would try to break the resistance at $1,090, then the psychological $1,100.

Chart: H1 XAUUSD

Gold Sell-Off

Today's session caught Gold bears unprepared for the quick sell-off that occurred in the early trading hours. The yellow metal lost more than 1% of its price going from $1,096.78 to $1,082.46/oz.

Current market sentiment still remains bearish, but a quick pull to the upside might be expected in the short-term. Gold is still around the 5.5-year low and chances are it might continue its downward trend until fresh news boost prices up.

Live price update: $1,085-$1,086/oz

Chart: H1 XAUUSD

Warren Buffett Quotes

Here are some of the most brilliant Warren Buffett insights about life, relationships and investing:

"You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with 130 IQ."

"After all, you only find who is swimming naked when the tide goes out."

"Nothing sedates rationality like large doses of effortless money."

"Investors should remember that excitement and expenses are their enemies. And if they insist on trying to time their participation in equities, they should try to be fearful when other are greedy and greedy when others are fearful."

"Price is what you pay, value is what you get."

Gold, Little To No Change

Not enough is happening today that can stir the Gold market. Relatively calm day for the yellow metal with just about $2 difference in price since opening as traders and investors are waiting for fresh news that would move the markets.

Short-term resistance rests at $1,107 as short-term support can be found at $1,073.

Current Gold price: $1,094-$1,095/oz
Chart: H1 XAUUSD

Gold Lifted

Gold prices are modestly higher in today's trading session due to China stock market worries. The selling pressure in the stock market and the lower US Index benefited Gold which played its role as a safe haven.

Worries about China may continue to be the center of attention which would drive more traders and investors to prefer the Gold shores as a safe haven. The yellow metal is currently trading at $1,094-$1,095/oz.

Accelerate your learning curve as a trader

Once again ActivTrades did not disappoint with their webinar. This time it was called "Accelerate your learning curve as a trader" and viewers had the opportunity to hear how to be consistent and engaged in the challenging and rapidly changing market environment.

To learn more about trading and how you can advance your trading education make sure you follow future webinars which you can find by clicking here.

Gold Under Pressure

The yellow metal was able to pull off a corrective technical bounce elevating prices above $1,100 only to fall short again below the key psychological level. Prices reached $1,105.90 today but strong selling sent prices to $1,087.18 thus making it harder for bulls to even begin to suggest a market bottom is in place.

Gold is currently trading at $1,090-$1,091/oz.

Interesting Gold Fact

The purity of gold is measured in carats. The word comes from the Greek keration, the carob tree. A member of the pea family with horn-shaped pods (keras means “horn”), its seeds were believed all to be the same weight, making them a handy standard for measurement. A pure gold coin was defined as weighing the same as 24 carob seeds, so “24 carat” became the measure of 100 per cent purity for gold, 99-99.9 per cent in actual fact. Gold deemed “18 carat” is around 75 per cent pure.

“Gold” is descended from the Prot-Indo-European root ghel- meaning “yellow” or “bright” and its chemical symbol Au comes from the Latin aurum, which also means “dawn light”.

Is Gold Stabilizing?

On the Day1 chart Gold looks like it finally found the so-needed support right after the 5.5-year low made on July 20. After Gold reached $1,071.28 it regained some of its value to currently trade at around $1,090-$1,095/oz.

Although still in the negative, Gold looks poised to try and climb at least to the psychological key level of $1,100. If it does not find the strength to do that, market participants might quickly lose interest thus creating low liquidity and opening the way to further depreciating the yellow metal.

Chart: D1

Gold Off The Charts

The Gold market came crashing down this Monday morning by the mind-blowing 4%. The yellow metal passed a 5-year low hitting as low as $1,071.28 and regained some of its shine to currently trade at around $1,112-$1,116/oz.

Gold bugs are caught by surprise and is expected that this week would be heavily volatile.

Charts: W1, H1

Gold Undervalued

Gold prices are gravitating around the lowest levels since October 11, which marks 8-month low for the precious metal. This could turn out to be a reason good enough for investors and long-term traders to get into a heavy position and keep adding to it, given that Gold would once again be regarded as a preferred investment.

Gold is more of an undervalued asset right now and market participants would soon start to allocate some of their fund into it as they always have. Gold prices have been declining for quite a while now, we are at a critical level of support. If we break that $1,140 level we might see a quick wash out down to $1,125 and even possibly $1,100.

Gold Extends Losses, 4-month Low in the Cash Market

Gold extended losses in the last trading session due to hawkish comments from Federal Reserve Chair Janet Yellen which turned out to be bearish for the yellow metal. Amid improving U.S. economy Yellen said the Federal Reserve is on the path to raise interest rates this year. The U.S. dollar index rallied on Yellen's remarks which was also a factor impacting the falling Gold prices.

Another reason for the rally in U.S. dollar index is the tottery Greek developments which could lead to global systemic risk and the uncertainties in the Chinese stock market.

Gold is currently trading in the range between $1,143 - $1,148 with market sentiment favoring the bear side of the trade.

Jesse Livermore's Wisdom Part 2

Let us continue with the second part of Jesse Livermore's nuggets of wisdom.

I believe that having the discipline to follow your rules is essential. Without specific, clear, and
tested rules, speculators do not have any real chance of success. Why? Because speculators without a plan are like a general without a strategy, and therefore without an actionable battle plan. Speculators without a single clear plan can only act and react, act and react, to the slings and arrows of stock market misfortune, until they are defeated.

I believe that anyone who is intelligent, conscientious, and willing to put in the necessary
time can be successful on Wall Street. As long as they realize the market is a business like any other business, they have a good chance to prosper.

Remember, it [the market] is designed to fool most of the people most of the time.

I believe that uncontrolled basic emotions are the true and deadly enemy of the speculator;
that hope, fear, and greed are always present, sitting on the edge of the psyche, waiting on the sidelines, waiting to jump into the action, plow into the game.

I never try to predict or anticipate. I only try to react to what the market is telling me by its behavior.

The game taught me the game. And it didn’t spare me rod while teaching.

Jesse Livermore's Wisdom Part 1

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Jesse Livermore had more than just a reputation. He was a gifted man whose rare talents were busily employed for one unyielding purpose: the exciting business of speculation (profits from price changes).

In the next few lines we have selected a bit of his timeless wisdom about trading and speculation. We hope you enjoy it.

It is what people actually did in the stock market that counted – not what they said they were going to do. 

The only way you get a real education in the market is to invest cash, track your trade, and study your mistakes…"

Take your losses quickly and don’t brood about them. Try to learn from them but mistakes are as inevitable as death. And only make a big move, a real big plunge, when a majority of factors are in your favor….every once in a while you must go to cash, take a break, take a vacation. Don’t try to play the market all the time. It can’t be done, too tough on the emotions.

Prudent speculators never argue with the tape. Markets are never wrong, but opinions often are.

Stay tuned for Part 2

China, Greece & Gold

Why has the Gold price remained flat amidst Greek debt crisis and China's stock market correction? This is the question that most investors and traders ponder upon. Common knowledge in the field is that Gold rises in times of global turmoil.

"Global" being the key word implies that if a current event or situation stays inside a country or a region, Gold would not react as much as if it were to spread to different territories and places.

Let's start with Greece. The reason that Gold did not react to the Greek referendum result was that the event was localized. Local events are not anticipated by Gold, because they do not affect the global economic situation. If the risks are not contained then we would get something called "the spillover effect", meaning that the impact from the Greek default would be felt throughout the Eurozone and the EU as a whole.

Now to China. Market participants expected that the 25% China stock market correction would trigger a flight to safety. But Gold price remained unchanged. We believe that this is because market may expect that the Chinese government would act accordingly and contain the fall.

Let us not forget about the competition between the U.S. Dollar and the yellow metal. A strong dollar means pressure on Gold's price.

But history repeats itself and Gold is still a high quality liquid asset that could be used to protect oneself from falling market prices, deteriorating market conditions and negative overall market sentiments. We have seen this behavior before - during the global financial crisis of 2008 the price of Gold fell for quite a while only to rise back up again. So if these current situations turn into systemic risks we would see a renewed inflow into Gold that would boost prices. And again there will be surprises.

Automated Trading

Automated trading is rapidly making its way into everyday use by traders and investors. Yesterday's event at ActivTrades called Automated Trading With the Smart Lines Expert Advisor was well presented and full of important information. Led by ActivTrades' Malte Kaub, the webinar laid out useful advice and practices that could be applied by everyone, regardless previous experiences.

For more information on other webinars and events that could benefit your trading click here.

Gold At Short-Term Resistance. Now what?

Gold could not care less for the developing situation with the Greek debt. It has its own way and its own behavior that has nothing to do with EU meetings, creditors or countries' defaults.

The yellow metal is strictly following the downward trend and earlier today hit the resistance line and reached its peak at $1,166.48 only to retreat a bit lower currently trading at $1,162-$1,163/oz. It is worthwhile to keep watching price's behavior and see whether it is going to break resistance, as this is only H1 chart. Odds are stacked on further price lowering due to lack of major news except the Greek debt crisis, but the impact on Monday could not be felt and did not make a difference which caused traders and investors to quickly lose interest.

Chart: H1 XAUUSD

Paul Tudor Jones' Wisdom

Paul Tudor Jones is among the greatest traders in the history of trading. The master trader called the 1987 crash perfectly, relying on the similarity in the technical analysis between a previous crisis and the one that was about to happen. On that day he shorted the market reportedly netting $100 million, thus making this trade one of the greatest of all time.

Here are his 15 best pearls of investment insight.

"The secret to being successful from a trading perspective is to have an indefatigable and an undying and unquenchable thirst for information and knowledge."

"Intellectual capital will always trump financial capital."

"The concept of paying one-hundred-and-something times earnings for any company for me is just anathema. Having said that, at the end of the day, your job is to buy what goes up and to sell what goes down so really who gives a damn about PE's?" (P/E is price to earnings ratio.)

"Every day I assume every position I have is wrong."

"Losers average losers."

"There is no training, classroom or otherwise, that can prepare for trading the last third of a move, whether it's the end of a bull market or the end of a bear market."

“You adapt, evolve, compete or die.”

"Trading is very competitive and you have to be able to handle getting your butt kicked."

"If trading is like chess, then macro is like three-dimensional chess."

“The whole world is simply nothing more than a flow chart for capital.”

"Failure was a key element to my life’s journey."

"Where you want to be is always in control, never wishing, always trading, and always, first and foremost protecting your butt."

“After a while size means nothing. It gets back to whether you’re making 100% rate of return on $10,000 or $100 million dollars. It doesn’t make any difference.”

"I believe the very best money is made at the market turns. Everyone says you get killed trying to pick tops and bottoms and you make all your money by playing the trend in the middle. Well for twelve years I have been missing the meat in the middle but I have made a lot of money at tops and bottoms."

"At the end of the day, the most important thing is how good are you at risk control."

Gold Bears in Charge

Today's session marked the lowest level of Gold's price since March 18 just briefly touching the $1,147 mark. Gold is currently trading at around $1,1150-$1,1154/oz.

H1 Chart shows that those levels are short-term support for the yellow metal, thus hinting a potential move to the upside with resistance at around $1,162-$1,167.

Bearish channel is still intact and going strong.

Chart: XAUUSD H1

Monday Wisdom

If you have to remember something for today, remember this: 

"The expectation of an event creates a much deeper impression upon the exchange than the event itself. When large dividends or rich imports are expected, shares will rise in price, but if the expectation becomes a reality, the shares often fall; for the joy over the favourable development and the jubilation over a lucky chance have abated in the meantime". ~de la Vega 

Chart: H1, XAUUSD

Gold and Greece

With the latest developments around the Greece debt crisis, Gold has not seen much of a positive sentiment from traders and investors. The reason for that would be that the U.S. Dollar is considered the best option to protect your capital and the well-known "Gold-Safe-Haven" scenario is not playing very well. At least for the moment. 

Greece, the land of debt, with missed payment to the International Monetary Fund, with banks shut down and with no sign of a new financial aid, is likely to default on other debts again this month. Being so deep into unknown territory, Greece is to vote on a referendum on Sunday. 

If they vote "yes," it will mean more spending cuts, more tax hikes, and more rounds of tense negotiations with European creditors. But in the long run, it could lead to a more united Europe. If the Greeks vote "no," it will likely trigger Greek exit from the Eurozone. That would cause turmoil for the Greek economy in the short run, but could ultimately give Greece more control over its destiny.

But at least Greece has nice places and lots of sunshine so they have that going on for them. 

Now, what would be Gold's reaction to all of this? It is well-known how easily Gold catches fire. A probable Greek exit from the Eurozone could add as much as $200 to the price of Gold in just a few seconds. And this time it will not have any correlation to the U.S. Dollar. Gold will divert and yet again gain the so-needed trust of market participants. Will Gold shine again? Soon we will know. 

Any open positions left over the weekend could result in massive gains that won't let you sleep from excitement. But they could also turn against you so bad you will not be able to see straight.

Chart: H8 XAUUSD

Greece's PM Alexis Tsipras has confirmed that his country would hold a referendum on Sunday on terms of its bailout after Germany rejected a deal offered by the Greek government to its creditors. 

No talks would be held before the Sunday's vote as Berlin rejects any further discussion.

An event of world importance such as this could easily wreak havoc in financial markets. In light of this, ActivTrades is implementing a measure that would protect clients by substantially limiting their potential losses by temporarily increasing Margin Requirements probably by 4 times on July 3. 

If you have any open positions be considerate and wise. Although holding any open positions during such events might get you rich quickly, it might also take your shirt off your back. 

Moral Story Of The Day

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“THE GOOSE AND THE GOLDEN EGG” (AESOP)

“The Goose and the Golden Egg” is a fable authored by the legendary storyteller Aesop, who lived in ancient Greece ca. 620 –560 BC. Many details about Aesop’s origins are unknown, yet it is widely believed that he was a slave from Phrygia who came to live in Samos. The corpus of moralistic fables attributed to Aesop has been passed on throughout the centuries from antiquity to the present. Although the fables have had varied significance according to the contexts in which the tales were read, Aesop’s use of animal narrators and symbolic natural elements to subtly illustrate the ironies and lessons of the human condition have in many ways remained timeless.

“The Goose and the Golden Egg” tells of a man and his wife who had a goose that laid a single golden egg for them each day. As the man’s wealth grew, he became dissatisfied with only a single egg each day and wished for more. Assuming the goose was filled with gold inside, the man foolishly killed it. Upon finding that the goose bore no treasure inside of her, he remarked to himself, “While chasing after hopes of a treasure, I lost the profit I held in my hands!” (adapted from Gibbs 2002). The moral of the story is that those who are greedy and seek to obtain more than they deserve risk losing everything they have.

The phrase “killing the goose for the golden egg” has evolved as a widespread idiomatic expression used in reference to events or actions that produce an immediate desirable result with potentially disastrous long-term consequences and is particularly common as a proverbial reference to shortsighted economic policies within the realm of banking and finance.