I like 26.40 better with silver here as a stretched move on the day to short SLW. the spread is still narrow today and SLW is betting on higher silver so I think 26.10 in a minute if silver stays here. It will be harder for it to push beyond that unless silver goes for 21.60 here. I think the base building the last few days provided a good call on higher silver and gold today and we should see some follow through tomorrow to the upside to try and break out of this huge bull flag. Silver will have to confirm overnight, but there are a lot of shorts still in SLW that did not cover during the big run up. I haven't seen the feb. month end numbers but it looks like they hung in there and will probably provide some lift into earnings next week. If we spike higher out of earnings to the 27.20 area, I will definitely fade it aggressively with puts and establish a hedge in silver as their forward p/e will be very high and the stream will be pricing in $26 silver, which is possible but not without SLW pausing as a move any higher would subsequently call for even higher silver and I don't see the reason for $50 silver in the short term, it would choke off demand.
The headline is misleading as is most information on the internet. I believe Virtu is a market making firm and probably gets most of their profits from exchange rebates against the opposing markets commission. The more volume they do the more rebates they do as the trade the "zipper" or the arbitrage between electronic exchanges at the same price. You maintain a market at every tick on both sides and bid and offer on the exchanges that give you a rebate for either providing or taking liquidity. Since they are all computerized and co located with their own gateways into the exchanges, they always maintain there spot in the from of the order book.
If silver can hang in here today, we should be able to try and close back over 26. The range is still small on the day against silver and should expand at least another 20 cents, so barring a wipeout in the metals this should push SLW back up to 26 at some point.
covered some shorts against the 25's, will kick these back out on the close. Looking for the daily low volume run back up to positive.
SLW strong again today, higher lows and higher highs. If they can run it back over the 25.56 area in the last hour like usual, we should see a move back to the top of the flag at 26.40 at some point before the end of the week or at least into earnings. It does not move down with silver but any uptick in silver and it starts to run, building a stronger base.
Late day buying seems to imply that money is betting on a move higher on the open but we shall see. Im usually only concerned with how money flows into the last half hour as that is the money that is positioned rather than traded.
yes, I think SLW got dragged up by the retrace in gold as silver never budged when SLW pulled back up. Sunday night should be the tell as SLW is hoping for a rally in silver back above the 50dma. Without a bounce in silver Sunday night I think it is ripe for a gap lower. Still waiting for a flat silver day with SLW down a nice clip as it has been a long time coming.
I like the 23.85 area, we could meet the 50dma there at the 50% retrace. I think 23.23 would be the the cat's meow. At 23.23 with silver at 20.88, the premium would be back to fair value as well. Either way for me, I would like to see a day of real weakness in SLW independent of the metals which hasn't happened in 30 days. I think this condition would be required to see these price targets met as the 200dma in silver should slow the decline enough for SLW to remain strong unless it gives in which I am positioned for. As always, the monkey wrench is earnings. If we don't move before then I will need to build out an options hedge all while trying to capture some volatility in lieu of premium paid to hedge off the SLW short, as it is large for me with the current stream premium. I would much rather go in flat to fade either direction after earnings if there is a gap.
Need another dip in silver to break this thing below the 25.10 area trend line. SLW keeps hoping silver makes a run to close back above the 50dma so it can continue to live in denial.
SLW has definitely traded opposite today. For the first time in a month it is being sold into on silver strength and quick to fall on any silver weakness. This is a complete reversal of the playbook as of late. Obviously, this could all change in a heartbeat. The silver chart looks more constructive today going forward. I imagine that will drag SLW higher if it continues. That being said, SLW may not perform as well until the premium comes out. Earnings are in a couple of weeks, so I see a slight upward bias into earnings as the everyone knows they are on last quarters earnings and can then boost projections into higher prices for the first time in a while. I am sticking with the long silver futures and a short SLW hedge, al be it skewed long silver.
Yes, and by my spread analysis with SLW trading at an extreme premium we should see some fireworks tomorrow to either break higher and try and bust out of this flag to the upside on any strength in silver over night or have a reversal after the open and head down on heavy volume. If we break higher it would put the ratios back into the area they traded when silver was $50 an ounce and everything was out of whack and panicky. To see these extremes with the metals not far off their lows is very odd and points to the extreme valuations being placed on the miners in general. I picked up a little extra silver on the close for protection, I don't mind holding the extra contracts on the way down to collect on the SLW as the gap below is huge in comparison.
No idea, but SLW is under obvious accumulation up here. I suspect it will require something big to turn into selling of any magnitude.