"Hi David, Have you got a target yet for you to start selling your June Gold futures yet?"

David Fuller's view One always has a view regarding potential but I do not spend too much time thinking about targets because they are little more than a wish list, rather than analysis. A Search under price targets, using the link shown upper-left, fourth item down, will produce 16 entries on this subject.

Nevertheless, I did mention what I thought might be gold's near-term potential in Tuesday's precious metals review.

With trading, which is very different from unleveraged investing, my first concern is to see a position do well enough so that I can sensibly place at least an in-the-money stop. That is the beginning of trading happiness because it eliminates most of the risk.

Thereafter, if I do anything, I am more concerned about monitoring the price trend that is unfolding, paying attention to Commonality (Search produces 195 entries for Commonality), monitoring sentiment, and keeping an eye out for any factors which might change the outlook. And if I am busy, which is often the case, I may do very little once I have a free ride, other than raise trailing stops in line with the trend.

I am likely to manage larger trading positions, which I will only build incrementally, usually within a trend to reduce risk, taking some profits on rallies and replacing on setbacks. I did this quite actively when gold and silver were much cheaper. For more on this tactic Search under Baby Steps, for which there are 281 entries. The same tactic can be used in reverse when shorting within primary downtrends.

An important and too often overlooked aspect of trading is stress management. This is not easy but it is important because few of us are at our analytical best when under stress. The conservative use of leverage will help to reduce stress and it will often outperform a more aggressive strategy.

In other words, if we are trying to hit sixes straight away, we increase our risk of being out for a duck - or either bowled, LBW or caught with a low score. Translation for Americans and Japanese: if we are trying to hit home runs we will have lots of strikeouts and pop flies.