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Follow the Yellow Brick Road: Gold Futures


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December Gold Futures

While some may have gravitated to the kitchen to bask in the aromas of the upcoming feast or perhaps laid early claim to their spot in front of the TV, I spent the better part of my Holiday morning pouring over gold future price charts. The structural evidence to me suggests that the advance from the late October lows of 1263.80 is unsustainable. It appears to me that the this rally could be characterized as non-impulsive and has unfolded in a complex WYZ pattern that is nearing its completion. The December contract as of this morning is trading at 1288.50. If prices were able to press up above the recent high of 1297.50 I'd be strongly favoring an investment in a bearish position. The channel extension comes in overhead between 1299 and 1302. This should mark the Z wave high of the structure I am observing. Historical cyclical studies blended with price projection analysis suggest roughly a 45 to 65 dollar decline. This scenario could take place within a 3 to 5 week time period from the structures terminating point. Implementing a January options strategy which is priced on the February futures currently trading at a 4.5 premium to December would allow one to take advantage of this assessment. The risk/reward measurement is extremely favorable. Please feel free to reach out to me at Walsh Trading to discuss this and other market opportunities.

My analytical breakdown focuses on a blend of wave pattern recognition, long and short term geometrical extensions and momentum signal interpretation.

Please join me next Tuesday as I apply Wave Theory and Geometric targets levels to this and other commodity markets.

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John Lunney

Senior Technical Analyst

Walsh Trading

312 878 2391

888 391 7894 toll free

312 256 0109 fax

jlunney@walshtrading.com

www.walshtrading.com

Walsh Trading

53 W Jackson Suite 750

Chicago, Il 60604

Walsh Trading, Inc. is registered as an Independent Introducing Broker with the Commodity Futures Trading Commission and an NFA Member.
Futures and options trading involves substantial risk and is not suitable for all investors. Therefore, individuals should carefully consider their financial condition in deciding whether to trade. Option traders should be aware that the exercise of a long option will result in a futures position. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.

All information, communications, publications, and reports, including this specific material, used and distributed by Walsh Trading, Inc. (WTI) shall be construed as a solicitation for entering into a derivatives transaction. WTI does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71.



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About the author


John Lunney began his trading career in 1989 as a clerk for IFO, the largest futures and futures options brokerage on the CME floor. Within one year, John was promoted to an executing floor broker responsible for handling large individual and institutional accounts. John’s knowledge of option theory and tactics quickly attracted a growing customer base. In 2000, John began exclusively trading futures and futures options for his own account. John later became a founding member of VI Capital, a proprietary trading company funded with personal and investor funds. At VI Capital, John was the director of risk management, technical analysis and strategy development. VI Capital realized multi digit returns over the course of 8 years of trading.

John has extensive trading experience in stock indexes, metals, commodities, energy and agriculture products. He believes that hard work reveals the best trading opportunities, and strong discipline creates consistent results. John possesses a unique ability to connect with customers, understand their goals, and work with them to create long and profitable relationships.

Contact John
Phone: 312-957-8108 or 888-391-7894
Email: jlunney@walshtrading.com

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