Well... were back into overbought territory, which... as well all know, ad nauseum, doesn't mean it can't continue into overbought. And... in this situation, I think it will certainly continue into next week. Breaking into high territory; the previous RSI drop was still a higher-low than the previous and silver is doing well. Of course, that means... protective stops on the trading portion of my SLW.
On the other hand, it is at the top of the mid-July channel, so maybe a pull-back is in order.
We certainly had a heck of a great opportunity to snap up SLW on Tuesday in the low 20s. Glad my stop pushed me out earlier, only to rebuy quite a bit lower.
Sorry, Hook. I thought you could follow along a bit easier. Let me break it down for you then - If you held shares back in March 2008 and looked how much they had appreciated taking today's price. . .they have appreciated about 21%. IF you take the rediculously low price in the $2's and look at the price today. . .you could easily say it just made its way back to where it originally was vs. appreciating 9x and being in a bubble.
I happen to count myself lucky buying in around $4.50 - not necessarily smart - just lucky.
Was that clear enough?
Your logic is pretty flimsy. Just because something sold for a given price at a given time doesn't mean that's its fair value today. You could easily apply the reverse logic -- that since JDSU sold for $100+ in March 2000 it must be worth $100+ today. The fact is that JDSU was wildly overvalued in 2000, and SLW was wildly undervalued at the height of the 2008 meltdown, even though the price of silver was only around $8 at the time.
I would advise you to make judgments based on fundamentals such as price-to-earnings, etc., rather than the laughable idea that stock prices should somehow remain fixed forever.
However, if you really need to learn this lesson first-hand, go ahead. If you really believe SLW is about to crash -- feel free to short it. Just be ready for the consequences.
I don't worry about it now. I bought about 4500 shares for our Roth IRA's in late March & early April, for ave. $16-ish per share. It's a long term hold for me and the wife. Will draw the profits in five years.
Good luck with your trading. But whatever your age, you may wish to think about doing the same. I'm predicting SLW to be around $100 within five years. It's model is too solid and I'm betting the longterm future of silver is extremely good, especially as manufacturing ramps up even more down the road. Would be a good thing to have a few shares in a Roth. Good luck to ya...