## Trading 'j' in Gold Futures

‘J’ is found in all markets. Indeed I believe that for a market to exist ‘j’ must be present because markets all rotate in a similar way to the turning of the rotor in the alternator of your car.

As ‘j’ is both negative and positive this means that there is a balance of long and short trades. As a consequence confidence in trading periods of ‘j’ produces returns irrespective of whether the general trend of a market is up or down.

The constant rate at which the rotor of a market turns is governed by the movement of the Sun. Given that the Sun is by far the largest electrical component in the solar system its influence is hardly surprising.

For example there have been 114 ‘j’ periods of rise and fall in the gold futures market since 1980. As the periods are always the same length and there is always the same interval between the periods, the next period is simple to calculate – we have the information when these periods occur as far into the future as we wish to go.

Since 1980 an investor with this knowledge would have earned an average annual return of 5% p.a. unleveraged with a maximum peak to trough monthly drawdown of less than 15%. To do this they would have needed to be in the market just 25% of the time.

As ‘j’ is both negative and positive this means that there is a balance of long and short trades. As a consequence confidence in trading periods of ‘j’ produces returns irrespective of whether the general trend of a market is up or down.

The constant rate at which the rotor of a market turns is governed by the movement of the Sun. Given that the Sun is by far the largest electrical component in the solar system its influence is hardly surprising.

For example there have been 114 ‘j’ periods of rise and fall in the gold futures market since 1980. As the periods are always the same length and there is always the same interval between the periods, the next period is simple to calculate – we have the information when these periods occur as far into the future as we wish to go.

Since 1980 an investor with this knowledge would have earned an average annual return of 5% p.a. unleveraged with a maximum peak to trough monthly drawdown of less than 15%. To do this they would have needed to be in the market just 25% of the time.

For investors and fund managers trading ‘j’ can be a very useful addition to the returns they generate from their trading strategies. The periods are simply historical facts. No filters or data manipulation has taken place. The fact they exist in all markets and can be seen as far back as historical data allows makes this market intelligence attractive to many investment situations.