Today has passed in a blur. I haven’t done or read that much, but I have spent a lot of time thinking about various markets. Gold has pulled back on low volume — it doesn’t seem to be strongly correlated with anything at present, which may be a positive sign as it suggests the market is running upwards for gold-specific reasons. Copper has moved a good distance in the right direction and I hope it will not re-test the breakout level, as my stop is there. Getting into a market that is breaking out with a low allocation of risk and a tight stop is something I have been thinking about for a while, and in this instance it seems to be working. Perhaps I should also have taken this approach in Brent Crude, which dropped below $80 and its 200-day moving average yesterday, and dropped again today. In my defence, I have not had good data on this market for very long — only since Friday — and I have been watching WTI for a break below $70. Last time WTI fell back to 70 a lot of speculators who had been long above 80 were shaken out, but this time it doesn’t seem to have happened, so the market could be primed for further falls. Really oil has been trading in a range between 73 and 86.5, but for some reason everybody seems to believe the range is 70-80, and goes long above 80 thinking there has been a breakout. A break below 70 could be an important blow to the “70-80 range” story.

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