Gold Trading Boot Camp E-Book

Gregory T. Weldon

• Herausgeber: John Wiley & Sons
• Kategorie: Fachliteratur
• Sprache: Englisch

Seitenzahl: 372

Veröffentlichungsjahr: 2011

Beschreibung

Praise for Gold Trading Boot Camp "If speculate you must, read Weldon first." --James Grant, Editor, Grant's Interest Rate Observer "This book delivers on all of the essential elements of successful financial literature. Weldon provides a compelling context, walks through the metrics that affect the price action, and assimilates the decision-making process in kind. From soup to nuts, this is one of the most comprehensive tutorials I've read on the subject of commodities." --Todd Harrison, founder and CEO, Minyanville Publishing and Multimedia, LLC "The gold price is rising in today's turbulent financial times. Preparation and knowledge are essential to profit from higher prices, and this book provides everything you need to take advantage of the trading opportunities thatlie ahead." --James Turk, founder, GoldMoney.com "This book, with its insights into the current investment climate coincides with what many feel is a new bull market in gold. There is no 'one-size-fits-all' investment approach, but every investor who applies such preparation and rigor as Greg outlines will certainly have increased returns with fewer losses. It should be on every investor's bookshelf, handy for reference, and re-read every year. Greg puts paid to the notion of random walk!" --Kim Evans, CEO, Global Building and Supply

Leseprobe

Table of Contents

Title Page

Copyright Page

Foreword

Acknowledgments

PART ONE - Evolution of a Trader

CHAPTER 1 - Trial by Fire

CHAPTER 2 - Neophytes and Neanderthals

CHAPTER 3 - The Show

CHAPTER 4 - The Firm

CHAPTER 5 - Character

PART TWO - Evolution of a Macromonetary Era

CHAPTER 6 - “Top-Down”—It Starts at the Top

CHAPTER 7 - The Golden Bull

CHAPTER 8 - Bretton Woods and the “System”

CHAPTER 9 - Seniorage

CHAPTER 10 - The Goldbug Is Born

CHAPTER 11 - The Emperor with No Clothes

PART THREE - Capital Markets: Looking Inside the Market

CHAPTER 12 - Welcome to My Boot Camp

CHAPTER 13 - Intermarket Analysis—The Tape Tells a Story

CHAPTER 14 - Who’s on First? Know the Players

PART FOUR - Looking Inside the Market Technically

CHAPTER 15 - Reading the Tea Leaves—Technical Analysis

CHAPTER 16 - Charts

CHAPTER 17 - Moving Averages

CHAPTER 18 - Oscillators

CHAPTER 19 - Rate-of-Change Indicators

CHAPTER 20 - Fibonacci Retracements

CHAPTER 21 - Historic Volatility and Volatility Bands

CHAPTER 22 - Volume, On-Balance Volume, and Money Flow

CHAPTER 23 - The Commitments of Traders Report

PART FIVE - Looking Inside the Market: Top-Down Macro

CHAPTER 24 - Again, Everything Matters!

CHAPTER 25 - U.S. Monetary Fundamentals and the Federal Reserve System

CHAPTER 26 - Energy Market Fundamentals

CHAPTER 27 - Global Trade

CHAPTER 28 - U.S. Fiscal Fundamentals

CHAPTER 29 - Inflation and Labor Market Fundamentals

CHAPTER 30 - U.S. Housing and the Consumer

PART SIX - Trend Identification and Momentum Trading

CHAPTER 31 - Why ... Trend Identification?

CHAPTER 32 - Trend Identification Techniques—Momentum, Timing, and Trading the Trend

CHAPTER 33 - Countertrend Trading—Divergence, Saturation, and Exhaustion

CHAPTER 34 - The “TIMID” Matrix

PART SEVEN - Defining and Managing Risk

CHAPTER 35 - Defining Overall Risk

CHAPTER 36 - Diversity

CHAPTER 37 - Position Leverage

CHAPTER 38 - Trade Risk

CHAPTER 39 - Correlated Risk

CHAPTER 40 - Sector and Portfolio Risk

CHAPTER 41 - Psychological Risk

Overtrading

Paralysis

Slow Motion

Ego versus Confidence

Gambling

PART EIGHT - Putting It All Together

CHAPTER 42 - Using What You Know When Making Decisions

CHAPTER 43 - Global Supply-and-Demand Fundamentals: The Mining Industry, Gold ...

CHAPTER 44 - Chart Library

APPENDIX - Precious Metals: A Secular-Macro Overview

INDEX

Copyright © 2007 by Gregory T. Weldon. All rights reserved.

Published by John Wiley & Sons, Inc., Hoboken, New Jersey. Published simultaneously in Canada.

Wiley Bicentennial Logo: Richard J. Pacifico.

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Library of Congress Cataloging-in-Publication Data:

Weldon, Gregory T., 1960-

Gold trading boot camp : how to master the basics and become a successful commodities investor / Gregory T. Weldon. p. cm.

Includes bibliographical references and index.

ISBN-13 978-0-471-72800-9 (cloth)

1. Gold. 2. Gold—Purchasing. 3. Commodity exchanges. 4. Gold—United States. 5. Gold—Purchasing—United States. 6. Commodity exchanges—United States. I. Title.

HG293.W45 2007

332.64’42410973—dc22

2006034740

FOREWORD

Commodity trading is never easy. It’s not meant to be, but it can be fun and it certainly can be profitable when done well. But even the most experienced investors cannot keep up with the changing markets as often and as well as they’d like because the very nature of the commodities market is to be confusing far more often than not. But amidst that seeming confusion, order can be found.

It does not matter if you are trading gold, soybeans, or bonds, a successful speculator has to keep an eye on what is happening in many markets around the world. At the same time, the speculator must be alert and mindful of his or her individual position in the marketplace.

I have been an observer/participant in the commodities world for more than 30 years. During that time, either as a hedger, floor trader, foreign exchange dealer, bond trader, or individual speculator, I’ve had far more than my share of dramatic ups and downs in the commodities markets.

It is in this light that I encourage traders everywhere to read Greg Weldon’s book. This book offers an intimate and insightful account of a professional trader from his first days as a novice walking onto the floor of the Commodities Exchange Center through the present, where he sits at home in New Jersey surrounded by sophisticated technology that provides him with ready access to data about markets in all corners of the world.

Not everyone will have the intellectual or psychological wherewithal to be a trader, but there’s still a good deal to be learned from Gold Trading Boot Camp. Whether you’re trading your own account, using a professional advisor, or simply wondering whether you have the courage to trade on your own, this book offers an accessible, reasonable, and usable approach to the commodities market. Gold Trading Boot Camp provides an overview to the world of commodities and how this world changes, and will change in the future, for investors. Further, Greg explains his approach to the markets, teaching those who read his book the things he relies up that can tell him where the markets may go—and when. Greg explains technical analysis; he explains trend identification; he explains momentum trading—how to understand the relationship between the U.S. economy, global markets, and more.

As I said, commodities trading is not easy, and it most certainly is not for everyone. That’s why Greg’s no-nonsense, disciplined approach makes sense. We must learn to trade like mercenaries, trading not on the bull side or the bear side, but on the right side, as Jesse Livermore once said. You have to learn to fight and invest on the winning side and be able to change sides immediately when one side has gained the upper hand. This is what Greg’s book will help you to do. I encourage every trader—old or new—to read this book and learn its lessons.

DENNIS GARTMAN President of Gartman Letter

ACKNOWLEDGMENTS

I’d like to thank my parents for their tough-yet-caring love, and for providing me with everything and anything a son could ever wish for. Thank you for giving me the best chance possible to succeed, in business, and in life.

I would particularly like to thank my dad for his never-ending support, loyalty, advice, constructive criticism, and praise. If not for his unconditional love, this book would have never been started, let alone completed. My dad gave, and gave, and gave, and he keeps on giving, without ever asking for anything in return. Thank you. I love you, and I dedicate this book to you.

I want to thank my mother for her love and her courage in the face of grave illness. Her attitude has been inspirational to many of us, more than she will ever know.

I want to thank the gang at Stanley B. Bell and Company: (the late) Stanley Bell, Craig Bell, Don Tierney, and Eugene Pastore, along with my buddy Mike Devaney, for their selflessness and willingness to teach, tutor, and mentor me during my early years on the trading floor of the COMEX.

I want to thank the guys at Moore Capital Management: Bob De-Franco, James Kelley, Chris Pia, and Zack Bacon, in particular, for their support, loyalty, and willingness to share of themselves in helping me develop as a trader and macro-thinker.

I want to thank the crew at Commodities Corporation: Sandra D’Italia, Kathy Filliponi, Chris Rose, Sandra Kaul, Jim Liu, Will Allen, and especially Randy Rose, for their hard work, willingness to share their knowledge, and their friendship.

I want to thank the people at Prudential Securities—John Fallon, Cindy Pavia, Louis Lukac, Fernando Santos, Kathy Jones, Ray Keenan, and Joe “Mason” Madigan—for their loyal support and the time spent assisting me during my evolution as a trader and research provider.

I’d like to say thanks to the personalities at CNBC Television: Consuelo Mack, Ted David, Ron Insana, and Liz Clayman, along with all of the associate producers who have given me the opportunity to share my opinions and insights with the investment public.

I want to thank Scott Ramsey and Michael Strupp of Denali Asset Management, along with (the late) Bill Darby, Greg Parks, and Howie Levine, for their friendship and loyal support.

I want to thank James Grant and Dennis Gartman for their selflessness and their enthusiastic willingness to mentor me in the research business, throughout the past 10 years.

I want to thank Martin Lysaght and Bill O’Herron for playing the role of confidante, for their constant and continuous feedback, critique, and valuable input during the production of this book, and throughout my career ... and for being the best friends a guy could ever want to have by his side.

I want to thank my “life friends”: Mike “Ollie” Oliver, Bob “Bobby-G” Gorham, Bill “Willy” Stein, Craig Pruett, Regina Caggia, Lauren Brofazi, Mike Ferrara, Mike Greco, Adam Kaufman, Steve Sferra, Paul Vames, Dave Conway, Steve Wainwright, John “Johnny Balls” Ferrallo, Gene Pastore, Frank and Kathleen Cohane, Frank and Cheryl Oliver, Sue Oliver, Jim Liu, Clifford and Kristy Moricelli, Marie and (the late) Bob Gernhart, Susan Lee Caruso, (the late) Jim Hughes (the late) Rob Duich (the late) Lee Cordon, my high school basketball coach Mike O’Brien, and of course my two brothers, Brian and Doug . . . along with all those that I failed to mention.

I would like to thank my editor at John Wiley & Sons, Debra Englander. Debra’s persistence, dedication, and, most of all, her unbelievable patience, made this incredibly difficult task quite a bit more enjoyable. I am not the easiest person to work with and Debra’s unbelievable patience was critical in keeping me motivated, allowing me to finish this project.

I want to thank Judith Gernhart for her unconditional love, support, friendship, and never-ending belief in me, without which this book would never have been started, nor completed. I am eternally grateful to know you. I cherish the time we spent together and the love we shared, and always will.

I want to thank Eileen Cassidy, for her intensity, her passion, and her love. I appreciate all the time you spent assisting me with the editing of this book. Thank you for all the feedback and hard work. You are simply the best career coach I have ever had the pleasure of working with. I am so happy to have met you (for which I am indebted to “Queenie” Bea), and I look forward to being with you for the fulfillment of your birthday wish!

And I would like to thank newly found “life” friends-family, Jack and Joyce Cassidy, John and Tamara Cassidy, Bob and Maureen Bea, Kathleen Cassidy, Andy and Maryalice Goldsmith, Patrick Cassidy, Christopher Fedroff and all the kids (you too, little ″Cassidy″) ... laughter and love make a perfect combination.

Last but not least, I want to thank my two children, Taylor and Victoria, for their unconditional love. You are the joy of my life, and watching you grow up has been the best part of the journey. I also dedicate this book to you.

GREGORY T. WELDON

PART ONE

Evolution of a Trader

CHAPTER1

Trial by Fire

I was walking onto the floor of the Commodities Exchange Center (CEC), formerly within the World Trade Center in New York City. It was 1984; the gold market had just gone through its most bullish price move in history and was in the midst of its postbubble collapse. I felt the same buzz that I used to have when I played basketball in college. The trading floor reminded me of a basketball court—it had that same electric energy coursing through the air. And, I was drawn to it from a place deep within my body.

Given the events of that dreadful day in September 2001, I hesitate even to mention the Twin Towers. But it is important to understand the significance of those buildings. The World Trade Center (WTC) was a testament to the development of global trade after the gold standard was abolished and also was evidence of the burgeoning wealth just beginning to be created in the downtown canyons and exchanges.

The gleaming Twin Towers embodied the proud-to-be-an-American feeling that permeated the country in 1984. There was a groundswell of new confidence that started at the bottom, worked its way up the ladder of wealth, and emanated from the fiscal and foreign policies implemented by Ronald Reagan. President Reagan had also restored a sense of pride in the average U.S. citizen, following the disastrous confidence hit during the Carter administration. Moreover, Paul Volcker, chairman of the Federal Reserve System, had played hardball with monetary policy during the go-go-inflation period. The era was capped by the Hunt brothers’ attempt to squeeze the silver market and the run in gold bullion prices to new all-time highs above $800. For gold, it had been a decade-long bull market that began when Richard Nixon removed the shackles from the U.S. dollar.

By 1984, we had already hit the second downslope in the postinflation period, as confidence was rising, prices and interest rates finally were falling, and the U.S. stock market was beginning to make some noise. While unknown at the time, the stirrings in the equity arena, flat for the better part of a decade, reflected the early phases of an evolution that would dominate the financial landscape up to the 1987 crash (and well beyond, through today).