How to start with $100 and turn it into 1 Million in 100 trading days!

eur/usd short at 1.3780, stop 30, target 100

risking 1%

and the last trade for the day…

Jay

After one day and so many trades and still at b/e is well done, imho.

I did a little better however, because I did nothing and am also at b/e. :stuck_out_tongue: :smiley:

Well, after one day it’s too soon to say anything. After a month maybe it will show what’s going on. :slight_smile:

Just today my bot couldn’t make those nice 30 pips because my network was down. :frowning:

Ok… thanks everyone who’s contributed and wished me good luck so far… It’s appreciated! I will respond to everyone who’s commented in the next day or so, but now it’s time for me to contribute to this thread what it really needs, and what I can’t believe I’ve overlooked so far!

A Plan

I started this thread as something fun…but more importantly, to show what it takes to be successful. Well, it’s time I make good on that intention.

To be honest, I feel a bit embarrassed about how my first day out went. I knew this would take more preparation than even my own trading in my primary account does, and I didn’t give it the respect it deserved.

So, i’m going to carry over some of my own rules for trading to this project. I will be posting them up, and I won’t be trading anymore here until I do so.

Now…forget setups, forget methods: This is what trading excellence is really about - Self Control and Habitual Excellence via a comprehensive plan that restricts impulsive action, and reinforces an a series of optimal performance actions.

I don’t have time at the very moment to put this plan down here, but I will be starting on this tonight. This will take some time, and until then, I won’t be taking any trades here. But rest assurred, I think that most folks will find this aspect of trading more helpful than most other things out there, and I know that this will likely guarantee success for my goal.

Without such a plan, I pretty much guarantee failure :wink:

So, now the fun really begins! Will update this thread within the next day or so with the first part of the trading plan.

Jay

Awesome jay! Can’t wait for it.

I am interested to see how this goes, too. I suspect that most successful traders find it very hard, for whatever reason, to adequately describe their thought processes. Discussing actual trades may be the best way to handle this.

Good luck, Pajo.

Your thread will close if you make huge amounts of money

http://forums.babypips.com/newbie-island/41436-2-74-2740-within-10-days.html

Giordano Bruno told “The earth goes round the sun”

So, to help you get a handle on this, you’ll need a loose goal for daily gains to accomplish the task.

There are roughly 250 business days in a calender year. We’ll call it 230 to allow an extra few days for time to just get away from it for a bit, and enjoy the beach. Or, in case an illness occurs, and you just don’t feel like messing with it.

That gives you 690 days over the next three years.

With that being said, there are some eye opening numbers that occur.

It really doesn’t take as much in the way of daily gains as one would think to get those numbers.

Just a measly 1.0016% daily to get there.

Here’s a daily breakdown:

 1 : $1010.06
 2 : 1020.22
 3 : 1030.49
 4 : 1040.85
 5 : 1051.33
 6 : 1061.91
 7 : 1072.59
 8 : 1083.38
 9 : 1094.29
10 : 1105.3
11 : 1116.42
12 : 1127.65
13 : 1139
14 : 1150.46
15 : 1162.04
16 : 1173.73
17 : 1185.54
18 : 1197.47
19 : 1209.52
20 : 1221.69
21 : 1233.98
22 : 1246.4
23 : 1258.94
24 : 1271.6
25 : 1284.4
26 : 1297.32
27 : 1310.38
28 : 1323.56
29 : 1336.88
30 : 1350.33
31 : 1363.92
32 : 1377.64
33 : 1391.51
34 : 1405.51
35 : 1419.65
36 : 1433.93
37 : 1448.36
38 : 1462.94
39 : 1477.66
40 : 1492.53
41 : 1507.54
42 : 1522.71
43 : 1538.03
44 : 1553.51
45 : 1569.14
46 : 1584.93
47 : 1600.88
48 : 1616.99
49 : 1633.26
50 : 1649.69
51 : 1666.29
52 : 1683.06
53 : 1699.99
54 : 1717.1
55 : 1734.38
56 : 1751.83
57 : 1769.45
58 : 1787.26
59 : 1805.24
60 : 1823.41
61 : 1841.75
62 : 1860.29
63 : 1879
64 : 1897.91
65 : 1917.01
66 : 1936.3
67 : 1955.78
68 : 1975.46
69 : 1995.34
70 : 2015.41
71 : 2035.69
72 : 2056.18
73 : 2076.87
74 : 2097.76
75 : 2118.87
76 : 2140.19
77 : 2161.73
78 : 2183.48
79 : 2205.45
80 : 2227.64
81 : 2250.06
82 : 2272.7
83 : 2295.57
84 : 2318.66
85 : 2341.99
86 : 2365.56
87 : 2389.36
88 : 2413.4
89 : 2437.69
90 : 2462.22
91 : 2486.99
92 : 2512.02
93 : 2537.29
94 : 2562.82
95 : 2588.61
96 : 2614.66
97 : 2640.97
98 : 2667.54
99 : 2694.38
100 : 2721.49
101 : 2748.88
102 : 2776.54
103 : 2804.47
104 : 2832.69
105 : 2861.2
106 : 2889.99
107 : 2919.06
108 : 2948.44
109 : 2978.1
110 : 3008.07
111 : 3038.34
112 : 3068.91
113 : 3099.79
114 : 3130.98
115 : 3162.48
116 : 3194.31
117 : 3226.45
118 : 3258.91
119 : 3291.7
120 : 3324.83
121 : 3358.28
122 : 3392.07
123 : 3426.2
124 : 3460.68
125 : 3495.5
126 : 3530.67
127 : 3566.2
128 : 3602.08
129 : 3638.33
130 : 3674.94
131 : 3711.91
132 : 3749.26
133 : 3786.99
134 : 3825.09
135 : 3863.58
136 : 3902.46
137 : 3941.72
138 : 3981.39
139 : 4021.45
140 : 4061.91
141 : 4102.78
142 : 4144.07
143 : 4185.76
144 : 4227.88
145 : 4270.42
146 : 4313.39
147 : 4356.8
148 : 4400.63
149 : 4444.91
150 : 4489.64
151 : 4534.81
152 : 4580.44
153 : 4626.53
154 : 4673.09
155 : 4720.11
156 : 4767.6
157 : 4815.57
158 : 4864.03
159 : 4912.97
160 : 4962.41
161 : 5012.34
162 : 5062.77
163 : 5113.71
164 : 5165.17
165 : 5217.14
166 : 5269.64
167 : 5322.66
168 : 5376.22
169 : 5430.31
170 : 5484.95
171 : 5540.15
172 : 5595.89
173 : 5652.2
174 : 5709.07
175 : 5766.52
176 : 5824.54
177 : 5883.15
178 : 5942.34
179 : 6002.14
180 : 6062.53
181 : 6123.53
182 : 6185.15
183 : 6247.38
184 : 6310.25
185 : 6373.74
186 : 6437.87
187 : 6502.65
188 : 6568.08
189 : 6634.17
190 : 6700.92
191 : 6768.35
192 : 6836.45
193 : 6905.24
194 : 6974.72
195 : 7044.9
196 : 7115.79
197 : 7187.39
198 : 7259.71
199 : 7332.76
200 : 7406.54
201 : 7481.07
202 : 7556.34
203 : 7632.38
204 : 7709.17
205 : 7786.75
206 : 7865.1
207 : 7944.24
208 : 8024.17
209 : 8104.91
210 : 8186.46
211 : 8268.84
212 : 8352.04
213 : 8436.08
214 : 8520.96
215 : 8606.7
216 : 8693.3
217 : 8780.78
218 : 8869.13
219 : 8958.37
220 : 9048.51
221 : 9139.56
222 : 9231.52
223 : 9324.41
224 : 9418.23
225 : 9513
226 : 9608.72
227 : 9705.41
228 : 9803.06
229 : 9901.7
230 : 10001.34
231 : 10101.97
232 : 10203.62
233 : 10306.29
234 : 10409.99
235 : 10514.74
236 : 10620.54
237 : 10727.4
238 : 10835.34
239 : 10944.37
240 : 11054.49
241 : 11165.72
242 : 11278.07
243 : 11391.56
244 : 11506.18
245 : 11621.96
246 : 11738.9
247 : 11857.02
248 : 11976.32
249 : 12096.83
250 : 12218.55
251 : 12341.49
252 : 12465.67
253 : 12591.11
254 : 12717.8
255 : 12845.77
256 : 12975.02
257 : 13105.58
258 : 13237.45
259 : 13370.64
260 : 13505.18
261 : 13641.07
262 : 13778.33
263 : 13916.97
264 : 14057
265 : 14198.45
266 : 14341.31
267 : 14485.62
268 : 14631.37
269 : 14778.6
270 : 14927.3
271 : 15077.5
272 : 15229.21
273 : 15382.45
274 : 15537.23
275 : 15693.57
276 : 15851.48
277 : 16010.98
278 : 16172.08
279 : 16334.81
280 : 16499.17
281 : 16665.18
282 : 16832.87
283 : 17002.25
284 : 17173.32
285 : 17346.12
286 : 17520.66
287 : 17696.96
288 : 17875.03
289 : 18054.89
290 : 18236.56
291 : 18420.06
292 : 18605.4
293 : 18792.61
294 : 18981.7
295 : 19172.7
296 : 19365.62
297 : 19560.48
298 : 19757.3
299 : 19956.1
300 : 20156.9
301 : 20359.72
302 : 20564.58
303 : 20771.5
304 : 20980.51
305 : 21191.61
306 : 21404.85
307 : 21620.22
308 : 21837.77
309 : 22057.5
310 : 22279.45
311 : 22503.63
312 : 22730.06
313 : 22958.77
314 : 23189.79
315 : 23423.13
316 : 23658.81
317 : 23896.87
318 : 24137.32
319 : 24380.19
320 : 24625.51
321 : 24873.3
322 : 25123.57
323 : 25376.37
324 : 25631.71
325 : 25889.62
326 : 26150.12
327 : 26413.25
328 : 26679.02
329 : 26947.47
330 : 27218.62
331 : 27492.49
332 : 27769.13
333 : 28048.54
334 : 28330.77
335 : 28615.84
336 : 28903.77
337 : 29194.61
338 : 29488.36
339 : 29785.08
340 : 30084.78
341 : 30387.5
342 : 30693.26
343 : 31002.1
344 : 31314.04
345 : 31629.13
346 : 31947.39
347 : 32268.84
348 : 32593.54
349 : 32921.5
350 : 33252.76
351 : 33587.35
352 : 33925.31
353 : 34266.67
354 : 34611.46
355 : 34959.73
356 : 35311.5
357 : 35666.81
358 : 36025.69
359 : 36388.18
360 : 36754.32
361 : 37124.15
362 : 37497.7
363 : 37875
364 : 38256.11
365 : 38641.04
366 : 39029.85
367 : 39422.58
368 : 39819.25
369 : 40219.92
370 : 40624.61
371 : 41033.38
372 : 41446.27
373 : 41863.3
374 : 42284.54
375 : 42710.01
376 : 43139.76
377 : 43573.84
378 : 44012.28
379 : 44455.14
380 : 44902.45
381 : 45354.26
382 : 45810.62
383 : 46271.57
384 : 46737.16
385 : 47207.44
386 : 47682.45
387 : 48162.23
388 : 48646.84
389 : 49136.33
390 : 49630.75
391 : 50130.14
392 : 50634.55
393 : 51144.05
394 : 51658.66
395 : 52178.46
396 : 52703.48
397 : 53233.79
398 : 53769.44
399 : 54310.47
400 : 54856.95
401 : 55408.92
402 : 55966.45
403 : 56529.59
404 : 57098.4
405 : 57672.93
406 : 58253.24
407 : 58839.39
408 : 59431.44
409 : 60029.45
410 : 60633.47
411 : 61243.57
412 : 61859.81
413 : 62482.25
414 : 63110.95
415 : 63745.98
416 : 64387.4
417 : 65035.28
418 : 65689.67
419 : 66350.64
420 : 67018.27
421 : 67692.62
422 : 68373.75
423 : 69061.73
424 : 69756.64
425 : 70458.54
426 : 71167.5
427 : 71883.59
428 : 72606.89
429 : 73337.47
430 : 74075.4
431 : 74820.76
432 : 75573.61
433 : 76334.04
434 : 77102.12
435 : 77877.93
436 : 78661.55
437 : 79453.05
438 : 80252.52
439 : 81060.03
440 : 81875.66
441 : 82699.5
442 : 83531.63
443 : 84372.14
444 : 85221.1
445 : 86078.6
446 : 86944.74
447 : 87819.58
448 : 88703.23
449 : 89595.77
450 : 90497.3
451 : 91407.89
452 : 92327.65
453 : 93256.66
454 : 94195.02
455 : 95142.82
456 : 96100.15
457 : 97067.12
458 : 98043.82
459 : 99030.35
460 : 100026.81
461 : 101033.29
462 : 102049.89
463 : 103076.73
464 : 104113.9
465 : 105161.51
466 : 106219.65
467 : 107288.45
468 : 108368
469 : 109458.41
470 : 110559.79
471 : 111672.25
472 : 112795.91
473 : 113930.88
474 : 115077.26
475 : 116235.18
476 : 117404.75
477 : 118586.09
478 : 119779.32
479 : 120984.55
480 : 122201.91
481 : 123431.52
482 : 124673.5
483 : 125927.98
484 : 127195.08
485 : 128474.93
486 : 129767.66
487 : 131073.39
488 : 132392.27
489 : 133724.41
490 : 135069.96
491 : 136429.05
492 : 137801.82
493 : 139188.39
494 : 140588.92
495 : 142003.54
496 : 143432.4
497 : 144875.63
498 : 146333.39
499 : 147805.81
500 : 149293.05
501 : 150795.25
502 : 152312.57
503 : 153845.15
504 : 155393.16
505 : 156956.74
506 : 158536.06
507 : 160131.26
508 : 161742.52
509 : 163369.99
510 : 165013.84
511 : 166674.23
512 : 168351.32
513 : 170045.29
514 : 171756.3
515 : 173484.54
516 : 175230.16
517 : 176993.34
518 : 178774.27
519 : 180573.11
520 : 182390.06
521 : 184225.29
522 : 186078.98
523 : 187951.33
524 : 189842.52
525 : 191752.73
526 : 193682.17
527 : 195631.02
528 : 197599.48
529 : 199587.75
530 : 201596.02
531 : 203624.5
532 : 205673.39
533 : 207742.9
534 : 209833.23
535 : 211944.6
536 : 214077.21
537 : 216231.28
538 : 218407.02
539 : 220604.65
540 : 222824.4
541 : 225066.49
542 : 227331.13
543 : 229618.56
544 : 231929.01
545 : 234262.7
546 : 236619.88
547 : 239000.77
548 : 241405.62
549 : 243834.67
550 : 246288.16
551 : 248766.34
552 : 251269.46
553 : 253797.76
554 : 256351.5
555 : 258930.93
556 : 261536.33
557 : 264167.93
558 : 266826.02
559 : 269510.85
560 : 272222.7
561 : 274961.83
562 : 277728.53
563 : 280523.06
564 : 283345.72
565 : 286196.77
566 : 289076.52
567 : 291985.23
568 : 294923.22
569 : 297890.77
570 : 300888.18
571 : 303915.75
572 : 306973.78
573 : 310062.59
574 : 313182.47
575 : 316333.75
576 : 319516.73
577 : 322731.74
578 : 325979.1
579 : 329259.14
580 : 332572.18
581 : 335918.56
582 : 339298.61
583 : 342712.67
584 : 346161.08
585 : 349644.19
586 : 353162.35
587 : 356715.91
588 : 360305.22
589 : 363930.65
590 : 367592.56
591 : 371291.32
592 : 375027.29
593 : 378800.86
594 : 382612.39
595 : 386462.28
596 : 390350.9
597 : 394278.66
598 : 398245.93
599 : 402253.12
600 : 406300.64
601 : 410388.88
602 : 414518.26
603 : 418689.19
604 : 422902.08
605 : 427157.37
606 : 431455.47
607 : 435796.82
608 : 440181.86
609 : 444611.02
610 : 449084.74
611 : 453603.48
612 : 458167.69
613 : 462777.82
614 : 467434.34
615 : 472137.72
616 : 476888.42
617 : 481686.92
618 : 486533.7
619 : 491429.26
620 : 496374.07
621 : 501368.64
622 : 506413.47
623 : 511509.06
624 : 516655.92
625 : 521854.56
626 : 527105.52
627 : 532409.31
628 : 537766.47
629 : 543177.54
630 : 548643.05
631 : 554163.56
632 : 559739.61
633 : 565371.77
634 : 571060.6
635 : 576806.68
636 : 582610.57
637 : 588472.86
638 : 594394.14
639 : 600374.99
640 : 606416.03
641 : 612517.86
642 : 618681.08
643 : 624906.31
644 : 631194.19
645 : 637545.33
646 : 643960.38
647 : 650439.98
648 : 656984.78
649 : 663595.43
650 : 670272.6
651 : 677016.96
652 : 683829.17
653 : 690709.94
654 : 697659.94
655 : 704679.87
656 : 711770.43
657 : 718932.34
658 : 726166.32
659 : 733473.08
660 : 740853.37
661 : 748307.91
662 : 755837.47
663 : 763442.79
664 : 771124.63
665 : 778883.77
666 : 786720.98
667 : 794637.06
668 : 802632.78
669 : 810708.96
670 : 818866.4
671 : 827105.92
672 : 835428.35
673 : 843834.52
674 : 852325.28
675 : 860901.47
676 : 869563.95
677 : 878313.6
678 : 887151.28
679 : 896077.89
680 : 905094.33
681 : 914201.48
682 : 923400.28
683 : 932691.63
684 : 942076.48
685 : 951555.75
686 : 961130.41
687 : 970801.41
688 : 980569.72
689 : 990436.32
690 : $1,000,402.19

Now, if you were going from $100 to the mill in one calender year, you would need very close to 10% a day.

So moral of the story is, don’t stress. It’s WAY within the means of most traders, the trick is just learning patience, and not trying to get it all tomorrow.

:slight_smile:

[Edit] The $100 to one mill was 9.246% to make it in 100 DAYS, not one year of trading days.

To make it in 240 trading days (or one calender year of trading days), it would take daily average gains of 3.8438%.

Not as easy as the steady Eddie 1% or so;)

Compounding is so powerful. The problem is the beginning, you would be hard pressed to live off the money especially since you do not want to ruin the compounding but if you can make it past that year one and keep rolling with the punches it is off to the races.

Agreed.

My goal is a daily .5%.

I’m usually done fairly early, and last week was done on Sunday night with two week’s gains banked courtesy of the Yentervention. I’m done for the night tonight already, and often have trouble sitting on my hands. But it was those double dip trades that used to get me in trouble.

After a year of it though, it gets easier. I see the gains mounting up quickly now. Patience is key:)

Not heard that one before - like it!

I sure hope i can hit a million in 100 days

No problem at all. If you start with a billion …

Good ole Buffett lost a few pennies last quarter I heard.

Jay, Whats going on?

Im 2 days in, Started with $20 now, and got my 10% each day, so Tomorrow, is day 3, and Im siting at $24.45

Dont stop man,

1 Like

Stick with it Jay… treat it like a business. :57:

What? and the world didnt stop spinning how did this happen

Congrats bout your profits! :slight_smile:

Now he teaches you a lesson: To have patience. Give him a little time. I guess he knows what he is doing.

@bobmaninc:

There’s Only One American Billionaire Who Lost A Lot Of Money This Year - Business Insider

Probably he was wrong when he had trust in the Bernanke solution, lol. :smiley:

we he said rule 1 to trading is not to lose money. I guess all rules are meant to be broken

Ok guys… I was out Ill for a few days, and also needed some time to think.

I needed to get some rest and recover from the flu, and I needed to decide on how to take this thread to the next level.

I said I would post up stuff as I developed it… and I now have something to post up.

The "How to turn $1,000 into a full time trading business " Trading Plan

This trading will be a bit different than the one I currently use for my own trades I take from which I pay my bills with. I have decided to use this as an opportunity to do something I’ve always wanted - creating a complete, fully comprehensive plan that emphasises not just risk management, entry criteria, and trade management (which my current plan includes), but psychological journaling, goal setting, and a more thorough analysis of trading opporunities.

My current trading plan that I’ve been following for over 18 months now (closer to 2 years) is built to determine entries solely on technical analysis, with an emphasis on orderflow and “supply and demand imbalances”. However, I have often wondered how much more effective a trading business could be if it had a trading plan that incorporated all the analytical factors that can be used to successfully speculate in the worlds capital markets including:

market sentiment, market fundamentals, market correlation, market relative strength, statistical anomalies such as “mean revision” strategies, and COT based concepts - I may add (or possibly subtract) from this list as my trading in this thread progresses.

[B]Orderflow[/B] (ie: supply demand imbalance concepts) has been, and will continue to be, the foundation for all of my trading decisions. However, I will use these other methods of analysis as decsions support tools, with regard to position sizing, profit target setting, and trade filtering

[B]Psychology:[/B]
Trading is a business that can by psychologically challenging…more than almost any other business out there. Therefore, I will also be creating a public journal detailing my thoughts and feelings as they become relevent to my trading decisions.There are times where I will see something happening with price action, volume, correlated pairs, or whatever, that may give me reason to want to exit a trade early, move stops to BE or trail a stop, increase my position size, decrease my position size, cancel a pending order…etc.

When these types of impulses arise,[I] I will not act on them[/I], but rather, write them down, and then compare what I felt to what actually happened. This will help me determine (over time) if my concerns were justified, or if they were simply distractions from optimal trading.

I will likley only be able to do this for one open trade at a time… Although time will tell (hopefully I can do it for all
trades I take)

I will post up as much of my plan as I feel I can. But as I stated earlier in this thread… i’m not teaching setups here. I’m striving to develop a skill set of true mastery. Of self discovery, and of guaranteed success. Plenty of threads discussing good setups out there… but not enough good info on personal trading development.

This thread…this experiment…it’s about just that. [B]Personal trading development… at a very high level.[/B]

[B]This isn’t about being perfect. It’s about being better. and EVERYONE can ALWAYS be better.[/B]

A long time goal of mine has been to incorporate a larger view of the markets and market dynamics than I currenlty consider. Well, there’s no time like the present.

So, this thread has now taken on a whole new meaning for me. It’s not about acheiving some lofty ambition to inspire (or “show off”…as both were true) as much as it is about me taking my trading to the next level. A level where success is not just typical, but guaranteeed. I firmly believe that a comprehensive analysis of all the important influencing factors in regards to both the market, and myself, will result in a plan that doesn’t just assist with success. It damn well guarantees it.

Now, I feel… I can really begin :slight_smile:

Jay

Now…for starters, here are some of the specific rules I have worked out for this project up to this point. I may modify, subtract, or add rules… but all rules must be followed unless I am “done” for the day. At the close of each day, I am free to adjust or modify this list of rules as I see fit…should I have a good, objective reason based in empirical data to do so. Otherwise…they stand pat.

A loss of a trade is not a mistake. A mistake is only a mistake if it breaks a rule on this list. Otherwise, there are no mistakes. The only rules that will never be broken is one that is in this plan. Everything else, for better or worse, is another experience or action to journal about, review later, and learn whatever lesson is held for me at that time.

Then, if this lesson is relevent, and proves valuable to improve my trading…it will be translated into a rule that will go into my plan.

Pretty cool i think :wink:

Anyway, as I develop these rules, I will try to compile them into one post. But for now, and likely for the next few weeks, I will just post them up as I see fit. Here are the first few rules:

[I][B]General Rules For Trading and Risk Management:[/B][/I]Maximum trades per day: 6 trades

[B]Maximum Loss per day:[/B] 3% - if hit, trading must halt until after U.S. session closes
for that day

[B]Maximum loss per week:[/B] 9% - if hit, trading must halt for the next 3 trading days. Review
trades and trade journal, diagnose mistakes, demo trade if necessary, but no live
trading.

[B]Maximum loss per month:[/B] 20% - if hit, trading must halt for 4 consecutive weeks. During
these 4 weeks, demo trading must be undertaken, and real trading cannot resume until
4 consecutive weeks of sucessful demo trading can be accomplished. This, combined with
trade reviews and trade journal review is required before trading can be resumed.

[B]Markets to trade:[/B]All forex pairs, majors, commodity, and crosses that consist only of:
AUD
CAD
CHF
EUR
GBP
USD
JPY
GOLD

[B]no other markets will be traded for this project [/B](although I do trade index futures,
oil, some silver, and even the rare bond trade in my own primary personal account)

More to come…

Jay

Ok…now, I am going to post up the analysis I did to gain an understanding of market bias from a fundamental and market sentiment point of view on gold, and the euro (specifically the eur/usd)

I will do this for every market I trade, the day before I trade it. If I do not have this degree of analysis conducted, I simply will not trade that market that day (oh! there’s another rule!)

To acheive this goal will require the utmost prudence… it will require me to be as responsible as possible.

Therefore, to risk any of my account on anything less than the most complete degree of preparation is either reckless or lazy.

And reckless, lazy folks don’t acheive lofty goals or impressive market success.

Without further ado - here’s the analysis:

Interest Rates of the G7 Currenies (AKA, majors, major crosses, comdolls)

1.US Federal Reserve Bank (USD) - 0.25%
2.European Central Bank (EUR) - 1.25%
3.Bank of England (GBP) - 0.50%
4.Bank of Japan (JPY) - 0.1%
5.Swiss National Bank (CHF) - 0.0%
6.Bank of Canada (CAD)- 1%
7.Reserve Bank of Australia (AUD) 4.5%

Notes on fundamentals:

Gold - Factors primarily affecting gold - (in order of importance)
euro instability: more unstable = bullish for gold (risk off trade)
euro union possibly liquidating gold reserves to “raise capital” = bearish for gold

These two mentioned above are the primary drivers in golds current value. The
two below are secondary:

world interest rates at record lows = bullish for gold
inflation: primarily in the U.S. Euro zone, and Asia = bullish for gold

Summary -
gold is being accumulated by larger institutions as a hedge primarily against euro
instability. If instability increases, gold will likely push higher. If EU countries
start liquidating gold reserves, this will likely put a short term pressure downward on
on gold

====================================

Notes on sentiment:
right now, 21 out of 22 surveyed by bloomberg expect gold to rise next week.
this is the 3rd consecutive increase and highest proportion in data going
back to 2004.
- Interesting to note…sentiment extremes typically (always?) foreshadow
a reversal - at least in the short to medium term.

====================================

COT and gold

Commercial holdings have hit a record net long back around oct 21st, when gold was
priced at around 1650. Since that time, commercials have been selling off, while large
traders have not greatly increased their net long positions. Small speculators have
greatly increased their net long positions however.

Summary: Gold is not only overbought in the short - medium term (1 week to 6 weeks),
but it looks as though the small specs have primarily been fueling this rise in gold prices.
Since small specs are the least influential group, and commercials are the most influential
group, it stands to reason that gold will be selling off a bit.* - it is possible
that my COT analysis is not very accurate in this case, as the driving force behind
supply and demand in gold is primarily speculative (so how relevent are commercials?)
and my understanding of COT is not as complete as I would like it to be, in order to
accurately gauge all but the most extreme overbought/oversold conditions.

Overall gold summary:

Sentiment in gold is extremely bullish… too bullish IMO. COT indicates a potential extreme
situation, and overall market survey bias is just too bullish (with everyone in, who
is left to buy?).

Combine this, with the progress (at least for now) made in the last few days in italy
and greece, and with the rumors that soverigens may start to sell off gold reserves to
raise capital to keep the EU afloat for now… it stands to reason that gold will be
pulling back this coming week, unless the EU situation takes a big step backward.

Technical levels of interest:

1791.2 - fridays high. Long stops will be above this price. Institutions will likely push
into this at a minium to gain liquidity needed for a short position.

1794 - a level that crosses previous daily lows: not the strongest level…but look for
PA and volume indications of a reversal. May take a small intraday trade here on gold
to the short side, based on PA and volume when price arrives at this level

1800 - major psychological level. Unlikely to take a trade here, as there is not enough
confluence

1804 - the level I feel most intersted in taking a short from. I will put a "set and forget
order here for a short, stop 1815, target 1780. I will cancel this order if gold hits
1780 before reaching 1804

1825 - another level I will place a set and forget order at. Stop 1835, target 1805, 2nd
target 1781.

Once PA and volume indicate that gold has topped out, I may take some short trades with
the “new trend” to the downside, as long as these trades can be entered above the 1750
price point.

=================================

THE EURO

Notes on fundamentals:

Euro - Factors primarily affecting euro - (in order of importance)
euro instability: greece and italy are the centerpoints, along with italy/greek bond rates (high yields are bearish for euro)
Italian PM Berlusconi stepped down, and change is hailed both in and out of italy as positive for economic stability
italian austerity legislation - quick and complete passing of this will be bullish for euro

These two mentioned above are the primary drivers in Euro’s current value. The
two below are secondary:

euro union GDP: up 0.2%, lowest level since june 2009 when it was contracting. Bearish for euro
euro union interest rate: the 0.25% surprise cut recently is bearish, but that does not change it’s relative place among all
major currencies (still paying 2nd highest rate, besides AUSSIE)

Summary -

euro has cleared a major stumbling block by pushing out the old guard with regard to italy/greece. Now the follow through
must be quick, and without hangups. If there are hang ups or glitches, we can expect the euro to find resistance. However,
going into monday, the state should be positive if nothing majorly upsetting comes to light.

====================================

Notes on sentiment:
as of last wednesday, 3 out of 4 hedge fund managers were “reluctantly net short” the euro. As of friday, we rallied.
I doubt all have covered as of this recent rally, and if the majority are still net short, combined with
recent positive news, i doubt others will be jumping to sell right now. Interesting to note, small speculators are net short.
they’re usually wrong… last week could be a short term bottom on the eur/usd: at least for the next day or 2.

====================================

COT and euro

Commercial holdings have just backing off a record net long last hit around June 2010.
Large specs are pulling back from a record net short last hit june 2010. Small speculators
are net short.

Summary: Not as clear as the gold COT charts…but there is some evidence that an upward move in the euro
against the dollar is more likley than more downward action, at least for this week.

====================================

overall euro summary

The euro looks to gain strength against the USD. This will place it in the middle of the pack, if not higher
against the other major currencies for this coming week. positive steps have been taken, and this should
take pressure off the eur/usd at least for the next 24-48 hours. ALthough a bit wary, I’m biased more to the
long side than the short side of the euro against the USD

Technical levels to watch:

Long trades only from these levels

1.3650 - top of a fresh daily demand zone

1.3610-1.3590 - to be entered only if PA and volume indicate a reversal. must be aggressively
managed and small profit targets only.

1.3560-1.3540 - ideal zone to enter a long trade.

1.3525 - 1.3480 - another great zone to enter a long trade.

Jay