"...If my analysis as to what has just transpired in gold is close to the mark, what does this portend in the future for gold and, especially, for silver? The one result that looks almost certain to me is a severe loss of liquidity or true market depth. In fact, it looks like the death of true liquidity for COMEX gold and silver, the signs of which are increasingly evident. I can assure you that I am very much aware of the recent high volume statistics recorded on the COMEX and despite what may appear to be high volume and great liquidity; the real level of actual market depth may be near death. Please allow me to explain...
...I believe we have also lost true liquidity in silver, as we have in gold. This can be seen in the volatility of the silver price, same as in gold. Back in April, the commercials panicked in silver and bought back shorts, causing prices to explode into the end of that month. Then, a giant manipulative takedown occurred, starting May 1. Recently, the commercial shorts in silver haven’t panicked as they have in gold. In fact, JPMorgan, who I believe to be the largest COMEX silver short, added to short positions in the last COT, as I reported on Saturday. Considering what has occurred in gold, I believe it is only a matter of time before the big commercial shorts also panic in silver. But the panic in silver will be much more profound than it has been in gold....
...The prime driver in the gold rally was commercial short covering on the COMEX. In silver, if the commercial shorts panic, it will trip off other powerful forces as well. That’s due to the basic difference between gold and silver, namely, that silver is an industrial material in addition to being a precious metal investment. Gold and silver can go sky-high in price, due to commercial short covering or investment buying. But since gold in not an industrial material, it is most unlikely that it could experience a shortage or a rush to buy by industrial users. How can industrial users panic if there are no gold industrial users?
Nice double bottom reversal off the trendline marked below. Very oversold and with massive macd divergence! A shoe-in to bounce. Anyone BTFD as per my post above??? I added the last of my funds at the lows.
I've tried to BTFD before, and it just doesn't work out for me. I like to let the price action develop. I added around 41.60 and I'm going to wait and see what happens. I use the stochastic rsi and macd on a 6 and 12 interval period on a 4 hour chart, with plenty of HSR and channels thrown in. The 2-4% price swings since August have been really painful, though.
"...When asked about silver specifically Embry replied, “The noted bullion bank, and we all know who it is, has an enormous short position (in silver), which can never be covered with real metal. They are moving heaven and earth to try to prevent the inevitable price rise. They will be overcome and the price will go berserk as a result of that. So once it clears $50, which I suspect it will do in the not too distant future, it’s onward and upward.”
Silver had a nice move off the divergent double bottom trendline bounce yesterday. The 4 hour chart is now overbought. I suspect that Silver will drop back down again at some point today...possibly back down to the trendline. No guarantees, but this will be THE weakness to buy! To see what I mean, look at the second chart below where price made a double bottom bounce off the trendline on the 24th & 25th. This is what I suspect will happen again.
The trendline lies near $41. Look to add/buy Silver anywhere near that trendline near $41 or even better LOWER than $41.
Yesterday's drop brought me back to being in with a 100% position.
Nigel Farage speaks such sense. An ex-broker:
Silver has broken up into a higher channel and thru resistance at 41.80. Looks very good to attempt new highs. First resistance is 43, then 43.50
Do you see it breaking higher now, rather than re-testing the trendline as you posted earlier this morning? That is my take on it at this point.
As per post 728, it looks higher. I see it testing the highs now, rather than testing the trendline.
Who knows what reaction will happen once it hits the 43/43.50 highs.
...and had no more dry powder of size to BTFD yesterday AM. Excellent call, though. Thanks for your continued contribution, Hi-Ho -- much appreciated.
I'm no Ho, but just wanted to share some findings.
Look at how the trendline bounces are narrowing as we wedge up (horizontal red lines). To me this shows how much pent up tension the EE is creating with it's smackdowns. Are they covering their shorts and going long knowing this beach ball is about to come shooting out of the water?
Notice the line is not broken to the downside and contained from the top down. Also each bounce is a 0 cross over on the Macd. And the bounces are taking less time to get back to the trendline.
One last thing. IIRC we reached 1.70x the 200ma at the May peak (70% above the 200 day moving average). Right now we're at 1.05x after spending 2 MONTHS "consolidating" well below the 200ma.
Either we see and epic free fall as the "smart money" finds a more attractive asset or we blast off like all the silver bulls are talking about. Interesting how the penant inflection point should be in the next two weeks when QE∞ is rolled out. This ain't rigged, noooooooooooo.....
I am using same charts - The crossover happening right now on that chart should propel us upwards, I believe.
Gold & Silver getting whacked here. Margin increases coming???
Not looking good here. A break thru this channel and the one lower could mean trouble!
Looks an excellent time to add Silver as the 120/240 min stochs are oversold, and price bouncing off a trendline channel. BTFD
Hat tips to you for all the work. Those are pretty charts. I like pretty charts.
i posted this on pailin's forum a few days ago but seems to be more useful posted here. Silver moves in 2 year patterns generally speaking. look at the moves of fall 2003 to dec 2004, and fall 2005 to dec 2006. look familiar?
If this doesn't explain to you whats coming up for the rest of the year, i duno what will. the only difference is that the current trendline is at a much steeper angle. so the correction at point E which is happening now shouldn't go below the 38s, i think. of course, this is only assumed by the fact that the trendline was the support for both 2004 and 2006. This should also explain the correction happening now for those clueless people who are mystified by this down move. Lastly, i hope you all understand that price doesn't move by demand and blah blah but by seasonal patterns unless there's some real change to the financial system, like in 2008. Good trading and keep the info flowing cuz we're all silver surfing together.
I follow Seasonality closely. Now is the seasonal time to buy...especially on any weakness.
There is a seasonality system I posted somewhere above that gives over a 90% probability of making money in Silver by being fully invested by August 15 and holding it all the way until January.
Your two year charts were also recently discussed by Gene Arensberg and Clive Maund, so you are not the only one to notice the moves. You may also notice that those charts look eerily similar to the INTRADAY BTFD moves that Blythe produces.
Interpreting Daily charts over a two year time frame is not a guarantee a probability of anything. I find looking at daily charts over a matter of a few months gives too much "wiggle" room as far as entries/stops etc. By interpreting 4hr charts I can wait for bullish directional/trending setupswhich COU LD potentially extend out to the longer timeframes like Daily charts. ..and hopefully get in NEAR THE LOWS of the move.