Patience, Patience, My Friend! – September 26, 2011

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[B][I]“In my way of thinking, patience has two faces – the patience to wait for the exact right set up and then the patience to stay with a winning trade.” [/I][/B]Peter Brandt

Reading this weekend interview of Peter Brandt by Charles Kirk (The Kirk Report), I found this quote to reflect perfectly the robot’s philosophy.

Those of you who entered the initial short setup at 70.81 on September 7 and had the patience to stay with the trade in spite of all the choppy market action are now sitting on an unleveraged + 8% gain. The IWM robot’s expected additional return over the next 3 days is a compounding +4.3% with a win ratio of 76.9%. The current trailing stop (69.19) protects you from a worst case scenario with a minimal gain of +2.30% if stopped out. Had you lost patience or confidence in the setup when IWM traded back above the entry between September 14 and September 16, you would likely sit now in cash with a small loss and a big frustration.

Those of you who are now in cash and looking to enter a new trade or add to their short position must have the patience to wait for the exact right setup. The robot is giving you the best optimal limit short entry he can see under current market conditions at 66.88. Experienced traders will notice at once that it would trigger after filling Thursday’s gap, after an overcut above Weekly pivot (66.64) but just below the 66.95 volatility stop with (65,5) settings on the 30-minute chart and below the DECLINING 5-day moving average and VWAP.

If this is not a perfect short setup, I wonder what could be! Furthermore, Multi-pivots analysis tells us that the first support cluster today is just stronger (15) enough than the first resistance cluster (11). Hence, everything else remaining neutral on the news and surprises front, the potential bounce to our new short entry limit is on the verge of becoming a reality. If you are instead burning to go long no matter what the robot says, 20 DMF analysis suggests a possible buy signal approximately one week away from now. Just be patient, my friend!

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The GDX robot is waiting on the sidelines and I’m glad he does heading into the hazardous Tuesday’s precious metals futures options expiration. Just be patient, my friend!
Billy

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Thanks Billy. There is an extensive Peter Brandt interview available through the Mercenary Trader site, too.