Monday, May 28, 2012

/gc: Backtest: MMA Flip Entry

This seems to be a high probability entry.

Gold is hard to trade so you need a lot of confirmation before safely entering with a tight stop.

This TL break actually extends back to Friday...

It then backtests through the 99 day MA which has not moved to the top of the ribbon and is sloping down.  Here a short ends up capturing a  60 tick move with no heat.   So even on a no-volume holiday -- it's possible to find the same old same old pattern.

Key elements:

1) break of a Higher Timeframe Pattern
2) volume candles suggesting distribution
3) Multiple Moving Averages lining up to show trend down
4) small backtest into resistance.
5) Awareness of Market Signals (euro and oil were starting to fade)

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