Over the last four weeks, SLW is up $6 and RSI has gone from 30 to 70 plus. I think the odds are very much in your favor for a quick profit.
Looking at a 10 day chart with 1 minute divisions and a 480 minute simple moving average, today is the first day there has been a meaningful move below the MA line. It could signal the $23.65 gap fill is near at hand. It is interesting that the gap is just slightly above the upper channel line established late March and early April. Not sure it is significant, just an observation.
There was a small gap at $20.42 Dec 31, 2013 that did not get filled until late May. I would imagine gaps do not have to fill, but if this recent gap at $23.65 does fill, it should fill in a matter of days and not take five months. It may be the best and last near term buying opportunity we get.
Silver may show a bit of downward movement, but I believe downward pressure on SLW may be of less amplitude than silver if for no other reason than SLW is much easier and cheaper wrt commissions to buy than silver for the average investor. Lower cost to purchase will sway more people to SLW. Over the weekend, I read several EW TA writers saying they thought PM"s were going to continue their multi-year downward trend, and others that use a Sharpie and straight edge on paper, seem to be quite bullish, TF Metals Report being in that camp. The June 11 TF report is quite an easy read with a few very good charts and has been released to the public.
At safehaven punctuation commercial, Iriarte has a bearish EW analysis. Summary statement "Silver has now finished its barrier triangle, and the next movement should be a five wave structure downwards. I will use the channels on the hourly chart to indicate when this trend change has occurred." She is also pessimistic on gold and oil. She may be correct in her prediction, but I am not convinced. I am thinking a short term correction after the quick bounce we have had and then returning to an upward bias based primarily on more people realizing that the country cannot print its way to prosperity. Other thoughts?
This price action is amazing given this is generally a poor season for PM's. I did not expect this move, certainly not the amplitude. On June 10, Iriarte wrote as a summary for her gold EW analysis " The correction is incomplete. Price should move higher and sideways for another one or two days before the downwards trend resumes." For silver, on June 4, she wrote "Downwards movement fits the main wave count, but only movement below 18.581 would confirm it. If the main wave count is correct we may be about to see some strong downwards movement over the next week." Silver had the qualifier, but both articles were very bearish in my opinion. So where from here? I am expecting a correction and believe the suggestion to consider stop loss orders to be prudent. That will allow the winners to run and protect on the downside as a correction could be significant if the fiat boys feel threatened.
Also SLW is bumping up against resistance established late march and early April this year. Fed will chatter to be released in a few minutes which will likely move the stock, lower if recent history is an indicator.
I was thinking of the rise being aggressive as well Sharpie and was going to write some calls, but the fed announcement this afternoon is a wildcard for price action. Rather than be whipsawed, I am going to stand down and let the dust settle should we get a storm.
When the market treats them like a producer with expanding production and reserves. we longs should be rewarded handsomely. It is coming soon with a bump in PM prices as a kicker.
Not sure why, but I have had a couple recent posts end up in electronic never never land. Sometimes Yahoo can be frustrating
Fed reporting this week will likely have their usual temporary negative bias for PM's. Gold seems to have made a double bottom mid year and December of 2013 while silver seems to be in a down trend over the same time period. Roughly speaking, silver has also made a triple bottom with lows between $18.17 and $18.72. I am coming to the conclusion that these data and other information is pointing to a longer term base building bottom in PM's that should come to an end with rewards to longs, probably this summer.
SLW is bumping against resistance between $22.50 and $23.50 established late March and April. I am not going to get too excited until that resistance is breached, especially with June and July being seasonally weak months for PM's.
Well, we are above $21.13 again, but we are also against short term horizontal resistance around $21.50. It will be interesting to see how this works out given we are in a generally down period of the year.
Sharpie, it looks like we may be cutting through the trend line you mention on May 27 to the upside. Sure would be nice to see some follow through to spice up my June and July $22 calls.
Short interest reported at 15,276,102 as reported by NASDAQ for May 15 and confirmed by YAHOO. Care to cite the source of your information?
I am wondering if your timing is off a bit Sharpie, June last year was a big down month. Further, while not TA per se, June is not traditionally a bullish month for PM's. That being said, I took another small flyer on July $22 SLW calls, which are up abut 10% currently. I have not done so well on the short term calls as of late so I am happy the positions have been small. Bottom line in my opinion, the faith in our faith based monetary system is going to flee the markets triggered by some unknown catalyst and when that happens we will have significant volatility. I am not sure TA can predict that timing, which is why I dabble in the short term calls. Anyway, thanks for your thoughts.