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.
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?
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.
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.
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.
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.
Have a look at Clive Mounds article at safehaven punctuation commercial dated June 30 for an interesting article confirming the potential for a short term correction.
I was wondering if the surge in commercial shorts is miners selling product to lock in the current price. If so, then this could be a resistance point in the charts rather than signalling a significant correction. Thoughts?
I believe you are correct Moses and it may be the reason we head higher irrespective of TA. If the fiat control bankers are net long, it is OK for the PM's to move up even if the truth serum raises havoc with the federal budget via interest on the debt.
Not sure of the downtrend line you reference, but looking at moving averages, well they are certainly moving toward syc from 10 day through 200 day. RSI is holding stubbornly above 70 and MACD is looking favorable. We still have the gap at $23.65 that needs filling. I am not sure of what to think about the charts wrt to a correction and COT report does not pass the smell test for me so fortunately, I covered my small SLW July $26 put position this morning for a 15% gain.
Might be tough to get to the next fib level at $26.83 as the horizontal resistance established last August and September at $26.50 plus held last February march and may again hold on this run up. MACD, RSI, and moving averages are looking a lot better.
Hi Sharpie, Looks like we are wrong, at least within the time frame for a correction to the low $23's for SLW. SLW has also held up pretty well given the jobs report yet the horizontal resistance at $26.50 plus has been holding. The gap at $23.65 is still out there waiting to be filled. I covered the few short term puts that I had and wrote $26 short term puts as well as bought a few August calls, so I am now looking for a short term pop. Also supporting the change is seasonal s are turning mildly favorable for PM's. Are you sicking to your long put position?
I do not see SLV going below $19.75 or silver going below $20.50 or possibly $20.20 looking at a 3 year daily chart's upper trend line
Looking at silver spx ratio curve over the past year or so, would suggest we have not confirmed the bottom in value for silver. Looking at SLW silver curve shows SLW out performing the metal handsomely. SIL silver ratio chart also shows silver miners in general out performing silver albeit showing a bit of rollover the last few days. I am wondering if Silver stocks and streamers are leading the metal higher.
I appreciate the tenacity you fellows put into the EW analysis, but I cannot get out of my head that the action over the past trading day, particularly with gold and silver following, smells more like manipulation than response to weighted input from free market traders and investors. Any thoughts?