10. Look to the future
Finally, Gero watches for any price discrepancies between the front-month contract and the one after it. If he sees buying in the spread, that is a bullish indicator; whereas no buying is a bearish indicator. Although he watches the spread every time the contract rolls over, the December-February roll is the one he monitors most closely.
In addition to news sources like The Wall Street Journal, Bloomberg and Dow Jones, Gero also makes it a point to watch and read market commentaries produced by many of the brokers and others. “You never know how helpful the commentary will be, but you have to know if Goldman is bullish,” he says. “You have to know if HSBC, Credit Suisse or anybody else recently downgraded their view on gold.”
Profitable trading is anything but a simple affair. As Gero has shared, there are a number of things that affect every trade decision he makes. Having a checklist of important data to study established before considering any trade ultimately can help ensure you at least are making an informed trade.