Ollio's Gold - Supply and Demand

Jack, could you please confirm that the time we see on your chart is EST (UTC -5)?

Yes, my time zone is UTC-5:00.

There's no new play so far this morning (see chart above) as the market remains constrained within the established range between the 4 Hour High generated at 8:00 on 12/7/2016 and the 4 Hour Low generated at 4:00 on 12/7/2016.

We await new signals or a breach of either one of these signals.

Either way, any new signals or breach of existing nearby signals would offer limited upside or limited downside.

And this will be my only word of wisdom for today (i.e. last post) ...

Compare the chart in Post #1,306 to the one in Post #1,303.

Notice how all previous Lows have been breached (i.e. candlestick closed below the Long levels) and have been removed from the latest chart in Post #1,306.

Once signals have been breached, they are systematically removed from the charts.

Also note that once a signal has been breached, the technical levels of the new opposite signal which signals your entry are almost identical to the levels of the signal that has just been breached.

In other words, to avoid unnecessary risk, it is always better and more profitable to wait for a signal to have been breached before entering the market. Once the technical levels have been breached, you simply wait for an opposite signal and enter your trade using the new technical levels indicated by the FIA.

Do not chase the trade. Let it go.

The rule for breaching High and Low signals on any given timeframe is as follows:

(1) to breach a High signal, the market (candlestick) must close above the RED line, and

(2) to breach a Low signal, the market (candlestick) must close below the BLUE line.

Furthermore, the type of signal being breached always indicates the direction of the market on any given timeframe.

(1) in a Short trending market, the market breaches the Low signals.

(2) in a Long trending market, the market breaches the High signals.

(3) in a ranging market, the market does not breach any High or Low signals. Instead, the market remains range bound between the last High and the last Low.

Every time a Low signal is breached, the FIA will generate a corresponding High signal.

Every time a High signal is breached, the FIA will generate a corresponding Low signal.

Referring to the chart in Post #1,307 above, the only remaining Low signal which has not yet been breached is the one on the 8 Hour timeframe, generated by the FIA at 8:00 on 12/5/2016 .

I'm going to try, starting from highest TF's first:

as per this chart:

1) Monthly tf has breached the 11/1/2016 low level, and resumed a short cycle, and will remain short below 1226.35.
2) Weekly tf is also in a short cycle since it breached its 11/27/2016 low, and will stay short below 1171.62 .

as per this chart:

3) Daily tf is bullish (bullish consolidation, maybe?). It has breached previous low level at 1166.15, but has not printed a new low yet. It will stay in a short cycle below 1183.17
4) H8 has printed a new low, therefore is in a long cycle while above 1150.93. It also shows a high at 1170.50ish, and will stay short below that level.

On H8 we have both highs and lows, giving us:

1) an entry short at 1162.74, with a sl at approximately 1170.52 (using this number as the other is not visible) with risk of $7.78 (778 points). Our projected target is the long entry at 1156.21, for a profit of $6.53 (653 points). RR is 1/ 0.83

2) an entry long at 1156.21, with a sl at 1150.93 (plus $1 buffer = 1149.93) so risk is $5.28. Our first target has to be the most recent short entry at 1162.74, giving a projected profit of $6.53, with an RR of 1/1.23.

My conclusion: I would pass on both trades as levels are too compressed to give a favorable RR.

Since H8 is printing lower highs, I would wait for a high to print on Daily to enter short.

Trying to respond ... being blocked by airport security.

Will respond once I reach my destination (from Hotel).

Finally, here we go:

Starting with the Monthly timeframe, the market remains Short while below 1226.25. On this timeframe, we have a Short entry @1185.01 with a Stop Loss @1226.35 (or slightly above). The market has not breached a Low signal since the signal generated by the FIA was a Short signal.

On the Week, the market has breached a Low signal such that we have an entry Short @1164.69 with a Stop Loss @1171.62 (or slightly above).

On the Day, the FIA indicated the market remains Bullish while below 1167.38 (the RED line). We expect a Bullish retracement towards these levels. Although we must remember that the Day remains in a Short market cycle while below 1183.17 as indicated by the High signal dated 12/5/2016 on this timeframe. Market is expected to resume Short.

On the 8 Hour, we have a Low signal which indicates the market remains Long while above 1150.93. On this same timeframe one must also consider the technical levels of the closest High signal generated at 8:00 on 12/9/2016. This signal indicated the market remains Short while below 1170.52. Since the market is Short on the Monthly, Weekly and Day timeframes we would consider a Short entry using the technical levels indicated by the last High on this timeframe. Which implies we would consider a Short market entry @1162.74 with a Stop Loss @1170.52 ( or slightly above).

On the 8 Hour, you could have also taken a Long entry @1156.21 with a Stop Loss @1150.93 (or slightly below) provided you consider a Take Profit @1162.74 which is the Short entry on the nearest High. This would have been a scalp since we know and expect from the higher timeframes, the market will resume Short.

Was my previous post of any help to you bubola?

Yes thank you.

Hi Jack, could you please clarify? Shouldn't it be it remains bearish while below 1167.38? Thanks.

The purpose here is simply to warn traders that the market will retrace towards the technical levels indicated.

In other words, in this configuration, a pull back is imminent.