Letter to Jake by Stuart J. Pahn
You asked me to explain some of the main factors I consider when making a trade. Let me use my most
recent trade as an example.
As the attached equity run shows, I sold short a contract of June Comex gold on May 1, at $345.10, and
covered it May 6 at $343 for a gross profit of $2.10, per contract.
The accompanying chart shows the daily price action of June gold with a couple of moving averages
superimposed and volume plotted below the price bars. As a long-time Wyckoff student, I usually begin
analysis by examining the price/volume relationship....