Successful Trading And April Precious Metal Targets

Wednesday, March 16, 2016

I often get asked what it takes to become a good trader. There are many skills to master several of which are discovered through failure. Regrettably, something like 90% of amateur traders fail within the first year. So what is it the successful traders do differently to separate themselves? They control their emotions, show excellent risk management and keep their positions sized appropriately.

Get Rich Slow

Contrary to popular opinion, the most reliable way to generate lasting wealth is by getting rich slowly and through a lot of hard work. Not what you wanted to hear? The sad truth is that many who suddenly become wealthy lose nearly everything within a few short years. A rapid influx of money doesn’t change who a person is at their core; if they made poor decisions before they will indeed make poor decisions after. They never had a money problem; they just lacked wisdom, a tireless work ethic, and fiscal discipline.

For the average person who dreams of improving their economic status, it’s best to do things the old-fashioned way, by working their butts off, living sensibly, and choosing to save and invest, rather than spend. Dreams and desires fuel their passions, and those passions drive them to a harvest of achievement. The journey is long but worth it. They grow in wisdom as they become seasoned; their persistent efforts build a long-term and lasting prosperity.

Contrary Investing

We are pack animals seeking approval from our peers, but investing is a dreadful place to do that. Just last week someone asked me, “What’s hot right now?”, a common inquiry I hear from the uneducated investor. Instead of searching for an asset class or stock that is underappreciated, ordinary investors do what's trending or popular at the time. Refusing to think for themselves, they follow the crowd and frequently enter the market at precisely the wrong time. The smart money who purchased long ago, while an asset was unloved, undervalued, and shunned by popular media, happily sells their shares to this dumb money during a massive distribution phase.

It’s You Versus You

As an investor, you play on a field that has no teams, no cheerleaders, and no playbook; it’s you against yourself. Only you can decide when, what, and how much to buy. You select stops, examine risk models and choose a price to exit. Experience is your primary teacher, and, if you’re fortunate, you may come across an outstanding coach to teach you. If you falter, you rise again, learn from that failed contest, and get back to work! Successful investors have periods of despair. Never giving up, embracing humility, and growing from our adventures is what produces enduring success.

Gold And Silver Forecast

Two Fridays ago I called for a potential top in gold; prices pushed a few dollars higher and now appear to be rolling over as predicted. I will get into the charts below, but you may find last week’s article an interesting read The Final Move Lower In Gold.

Gold Price Target

Prices diligently tried to break above the downward sloping trend channel, but ultimately failed to close above it. From here prices will drop into an intermediate cycle low (ICL) sometime in late April. The primary target will test $1,170-$1,140. The secondary target could see prices fall back to where the extended move began at $1,090.

Silver Price Target

The weekly chart still shows a clear pattern of lower highs followed by lower lows, the definition of a downtrend. Silver topped out a few weeks ago at $15.99, and prices will now head down into an intermediate cycle low, likely testing and marginally breaking the December low of $13.62. 

Hui Target

The HUI exploded out of the January low and has risen to retest the blue trendline from a previous breakdown, similar to 2015. Price is possibly creating a bearish, engulfing pattern this week, and we show a minimum spring target starting at 145.

The next few weeks are critical and targets may be adjusted. The FED announcement today could change things if they drastically adjust course. There will be a bounce out of the April low, and prices should start their final descent into an 8-year market bottom. After that, stay tuned - this could get exciting.

AG Thornson

AG is an accredited CMT through the MTA and the editor of His members receive daily updates and regularly scheduled reports 3-days a week. He prides himself on making his analysis easy to understand through the use of adaptive and creative charting methods. You can reach AG at [email protected].