While browsing news, and different blogs I had a thought that I'd like to share. Everyone seems to be so focused on technical analysis, trading systems etc. that the forgotten art of choosing a stock based purely on fundamentsals seems to have been left to days "past", or those thinking like Warren Buffet. So, what is it that you know that others don't yet know?
That's the key, and one you should ask yourself with each trade, and investment. If you're using technical analysis then so is everyone else. What is it that makes your trade stand out from the rest. Do you sniper? only to watch it skyrocket after selling? Do you base your buys on TA, only to watch it languish for weeks on end?
I'm not saying I have the answers, but I do believe a combination of both, TA and FA are key to success. At this point in time, we need to take a step back and take a look at the "Big" picture. Where is the market heading? Where is the bottom for POG? Everyone is calling for a large pullback in gold...will it do that?
If everyone is thinking 1260 for gold, will it hit that?
I don't think so! there's 2 scenarios: imo
1. POG continues in an upward bias from current levels, since everyone things otherwise. As I look, this evening POG is at 1375
2. POG breaks down and hits 1260, but then continues on downward.
If it breaks down, bottom could even been under $1000...far more than any analyst or technical advisor is calling for. Why? Simply because it will go opposite of what everyone expects.
I've said this before, and I raise the point again. If everyone expects gold to breakdown from here, will it? Who's left to sell at this point, if those with foresight have already sold?
If POG expected bottom is 1260, will the downside continue once hit? I don't know, because those expecting that bottom will have already bought at 1280...so who's left to buy?
Just some of my own thoughts on Sunday, Jan. 09. Caution warranted.
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