my journal 3

Odd experience today, and it reminds me of what I heard from more than one of these silver gurus I was watching.

Lately, as today, I've increasingly been seeing occurrences of this situation: everything is red. These gurus were saying that if the financial markets and the global financial system go bankrupt and collapse, everything could fall all at once and go to zero. I have always had a hard time grasping this given my average financial knowledge (especially when it comes to the global scale of it), but now it's becoming a little clearer, at least by looking at futures on my TWS. The days, like today, when everything is red are increasing in frequency. I don't remember seeing such days at all a few years ago.

I guess I could explain this to myself in common words, at least I'll try. Take stocks: are people interested in stocks when they fear an impending financial collapse? No. Then they'll fall. But then if people fear such a collapse, will they invest in bonds and bond futures? No, so those will fall as well. And then we come to grains and metals. People will be interested in eating of course, and so those should not fall, but what if there is a disconnect between the prices of physical commodities and virtual paper commodities? Then the derivatives will fall as well, despite the fact that grains will always have a value. The same applies to metals. These silver gurus, whose videos I've been posting, have mentioned a divergence between the price of the derivative and the demand in physical coins. The demand (maybe manipulated) for derivatives goes down, while the demand for physical silver goes up. That's what's happening right now ("drutter's divergence").

Of course for currencies it is different, because if one currency rises or falls, the opposite is happening to the other currency, so by definition they cannot go to zero, so I'll skip this analysis, because it's too complex, it doesn't apply, and I don't know all the implications of forex.
 
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I still haven't managed to learn total self-control (I still have a big ego to deal with), but it definitely seems that reading charts and being a profitable discretionary trader can be learned. I will be attaching my work on the chart game at the end of this post.

I don't believe that prices are random, and my profitability at the chart game shows it. Obviously they're not random. Obviously! I've known it for a long time, but professors wrote books on this concept, from what I've heard. Well, I finally have quick tool to show them that they're wrong - the chart game.

I have now played the chart game for 34 days in a row, with an average daily return of 19 percent, and only 5 losing days out of 34. I am definitely profitable at the chart game. I now have to learn more candlesticks patterns, and I've still got that problem to take care of - not getting mad when I am wrong. But even with those days when i get mad and lose a zillion percent on a chart, even with those days, I am profitable.

Then, after I'll be done with all of this, I will simply have to apply it to real trading, that is to the 19 futures I am monitoring. I can already tell that I haven't been trading them the way I am playing in the chart game, and simply because this practice on the chart game is opening my eyes, regarding chart patterns that I hadn't identified as profitable until now.
 

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Getting better on the chart game. The absolute rule is to wait at least 5 minutes between every game. I still have a lot of practice ahead but I am finding it an extremely pleasant learning process. Today I didn't lose control. There's emotions stirred by trading: euphoria when you win, frustration when you lose or miss profit. They're all effectively eliminated by those compulsory 5 minutes between each game.
 

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I keep hearing this same explanation given at minute 24 by keiser and maguire, that the central banks manipulated the paper market to lower the price of physical gold and buy it back but failed, as people kept buying physical gold:

Keiser Report - Episode 477 - YouTube

Andrew Maguire (whistleblower) - Wikipedia, the free encyclopedia
Andrew Maguire is an independent bullion trader and a whistleblower. He alleged to United States regulators that fraud had been committed, and that prices in the international gold and silver markets had been manipulated. Maguire and his wife were injured in a hit-and-run accident a day after he was identified as the source of the allegations.

Andrew Maguire has 40 years of experience as a trader and is a former Goldman Sachs trader.[1][2] On March 29, 2010, he was interviewed on the radio with Gold Anti-Trust Action Committee (GATA) board member Adrian Douglas.[3] He went public in April 2010 with assertions of market manipulation by JPMorgan Chase and HSBC of the gold and silver markets,[1] prompting a number of lawsuits,[2] including a class action lawsuit.[4] Maguire said "JPMorgan acts as an agent for the Federal Reserve; they act to halt the rise of gold and silver against the US dollar. JPMorgan is insulated from potential losses (on their short positions) by the Fed and/or the U.S. taxpayer."
Click to expand...

Keiser Report: Andrew Maguire on manipulation of gold prices, part2/2 (25Apr13) - YouTube
 
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travis said:
Odd experience today, and it reminds me of what I heard from more than one of these silver gurus I was watching.

Lately, as today, I've increasingly been seeing occurrences of this situation: everything is red. These gurus were saying that if the financial markets and the global financial system go bankrupt and collapse, everything could fall all at once and go to zero. I have always had a hard time grasping this given my average financial knowledge (especially when it comes to the global scale of it), but now it's becoming a little clearer, at least by looking at futures on my TWS. The days, like today, when everything is red are increasing in frequency. I don't remember seeing such days at all a few years ago.

I guess I could explain this to myself in common words, at least I'll try. Take stocks: are people interested in stocks when they fear an impending financial collapse? No. Then they'll fall. But then if people fear such a collapse, will they invest in bonds and bond futures? No, so those will fall as well. And then we come to grains and metals. People will be interested in eating of course, and so those should not fall, but what if there is a disconnect between the prices of physical commodities and virtual paper commodities? Then the derivatives will fall as well, despite the fact that grains will always have a value. The same applies to metals. These silver gurus, whose videos I've been posting, have mentioned a divergence between the price of the derivative and the demand in physical coins. The demand (maybe manipulated) for derivatives goes down, while the demand for physical silver goes up. That's what's happening right now ("drutter's divergence").

Of course for currencies it is different, because if one currency rises or falls, the opposite is happening to the other currency, so by definition they cannot go to zero, so I'll skip this analysis, because it's too complex, it doesn't apply, and I don't know all the implications of forex.
Click to expand...

The currency markets increase in volatility. Case in point 2008/9
 
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