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Silver next upswing

REO 54

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Sunday, January 08, 2012
Got Gold Report – Silver, You Ain’t Seen Nothin’ Yet
HOUSTON -- On the day after Christmas last year we shared with Vultures (Got Gold Report Subscribers) our commentary on the Commodity Futures Trading Commission (CFTC) weekly report of the commitments of traders (COT) in COMEX silver futures for the period ending Tuesday, December 20. A few days later, on December 28, we shared that review with our entire readership in these pages as a holiday courtesy. In that review we said, as simply and clearly as our command of the vocabulary can convey, that “this COT setup is about as bullish as they come.”

Since that report there have been two subsequent COT reports and the changes which have occurred and have been reported are in keeping with our view then that the positioning of the large traders of silver futures in New York: “gives us cover to begin adding in our green target box for silver with reasonable confidence, for the first time in over a year, if only the Trading Gods will allow it.” The green box on our tracking chart is visible in this reduced version of one of our silver tracking graphs we share with Vultures.



One of our silver tracking graphs at Got Gold Report. This is the 1-year, daily version which contains part of our weekly commentary in the dialog boxes. The chart is actually quite a bit larger than shown and must be reduced quite a bit to fit this format. Vultures have access to the full sized version any time.


Continued…

As Vultures already know, because they have constant access to all of our tracking and trading charts in the subscriber pages, we often use target boxes placed in advance on our charts to denote areas we intend to consider attempting a trade or to add to a position. In addition to those target boxes, we also often add commentary directly in the various charts to explain our thinking as the events and conditions change. It is a very effective way to convey how we are approaching the markets we track and game. Our “green box” for silver in our tracking chart has been in the same locale for quite some time – ever since we adopted the “Giant Flag” consolidation theory of the silver market.

Silver Enters and Bounces in “The Green”

On Thursday, December 29, having broken implied $28 technical support silver headed south in a hurry in nervous, thin trading early (in the U.S.), entering our green target box for the first time. As the trading neared the September panic spike low near $26.15 (actually the third test of $26 in 2011, having tested it in January and September prior) our instinct was then to set up a trade to fire the instant a bounce seemed to be in the making – so we did. As if on cue, bidding flowed in to support silver at almost the precise area the September panic spike was exhausted (about $26.15) (in the pre-market hours for the Big Markets).

For the first time in over a year we initiated a new silver trade that day, securing a long position in our predetermined zone of potential support (filled at $26.41), as Vultures already know. What some new Vultures may not know, and longer-time Vultures may have forgotten, our last silver trade was stopped out about a year earlier in January of 2011, as we disclosed then on the blog. (We urge readers to review that linked post, if for no other reason than to review the January 20 2011 chart before continuing this offering.)

Silver’s 2011 Bounce at $26 Higher Than We Expected

At the time, in late January of 2011, amid harsh profit taking for precious metals, including some of the heaviest negative money flow for silver ETFs we had seen up to that time, we had decided to target the area of a previous October 2010 flag consolidation for possible reentry (about $0.75 either side of $23 or so, as shown in the chart in the link above). In other words, in January of 2011 we expected more of a retrace by silver than actually occurred, as silver then fetched up just above the $26 level and just didn’t provide us with a reentry we were comfortable with then.

Consequently, except for our holdings of physical metal, we missed out on the run-up of silver from $26 to around $49 from January to April last year as far as our short-term trading was concerned. It was about that time that we adopted our current attitude with regard to silver – that since we already hold a meaningful position in physical silver, we had the luxury to wait for an extraordinary correction before taking another shot with our short term trading.

It should be crystal clear by now, but in case it isn’t, we believe that silver is in the midst of just the kind of extraordinary correction which allows us to put on a new short-term trading position – the first new trade in silver for us since August of 2010 (silver then below $19). We think that the fact that silver has come all the way back down from its near brush with an all time high in April to as low as $26.15 is a bona fide opportunity. Right or wrong, that is indeed how we have chosen to play it too.

http://www.gotgoldreport.com/2012/0...=3bb49e9d3a-Sprott_Money_247&utm_medium=email
 

KnowNothing

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What's the good word for today?

Ben Bernacles said interest rates to stay low until mid 2013, and now a big buying taking place?

Silver soared in the past couple days.

Any word from the wise, d-lod?
 

Jodster

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I think this thread is so quiet due to the fact nobody knows which way silver heads next. Expect silver to bounce around due to massive floods of paper silver. Once Iran makes the front page of newspapers, light the rockets!
 

jelly

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I think from here we begin the sideways movement that silver corrections are known for. I doubt we make a new low or a new high for the next 9 months. Just sit, wait, and accumulate the shiny stuff. My 2 cents.
 

Jodster

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'Lancers,

Do you think we have one more dip down near $30? I'm so kicking myself for not picking up some when First Majestic was selling at $32.50/oz
 

d-lod

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Is it obvious by now? 2 chances at $26 you will not get another. Notice the positive divergences on the second move down in late December.

Absolutely correct lhslancers3270

The daily chart has given positive divergence since second bottom at 26$, while weekly and monthly charts are not giving this positive an indication. The time frame suggest that the reaction phase was equivalent by 1, if it is on impulsive wave.

On weekly the momentum is continuing southward journey, which is an indicator, to be watch full of. With dollar index high the exchange for gold and silver has taken place at a bigger level.

Gold has different story, it yet has to complete its journey.

If silver is in impulsive wave than it has finished two minor waves, right now it is in correction wave.
 

lightcycler

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I'm going to try to post a graph
Silver where are we.jpg





If this worked then we can see the resistance line in play. Once taken out I would target silver to move into the $70 range before the next correction could take it back down to current levels before the big ass run :). Silver will make those inflated highs in the years to come but not without taking out all the weak hands and sending them packing for good :)
 

lightcycler

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I believe we will have a retracement of the wave I've outlined here. For Wave 1's the normal is a 0.618 or just under $30. Waves are always highest probability analysis.

Wave 1 retrace.jpg

Patients is always the biggest key for things to become clear. I am still trying to learn that lesson as it costs money to learn it :)
 

jbeck57143

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I'm going to try to post a graph

If this worked then we can see the resistance line in play. Once taken out I would target silver to move into the $70 range before the next correction could take it back down to current levels before the big ass run :). Silver will make those inflated highs in the years to come but not without taking out all the weak hands and sending them packing for good :)
Obviously no one knows exactly what's going to happen, but how likely is that to happen? If it does, you could sell some at around $70 then--when it went down to around half that you could buy about twice what you sold.
 

lightcycler

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Obviously no one knows exactly what's going to happen, but how likely is that to happen? If it does, you could sell some at around $70 then--when it went down to around half that you could buy about twice what you sold.
Only way to know is to assess if and when we get there. I'll be the first to admit I've been wrong about markets before. Some points are clearer and more sure than others. I'm still learning to only take action on those of the highest surety. I did buy everything I could in the $28 range on the second dip. Previous post outlined when I bought 12-14. Wasn't the bottom but sure could smell it from there :)
 

engineear

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If all this is being manipulated...what's the point of charts? No disrespect but, I think we need to know the "inside guys" for the dips and such. Of course, when TSHTF and Crimex is gone, then we'll see 200 dma be a thing of the of past...then it's time to sing "Rocket-man"...otherwise...I'm holding and watching.
 

hoarder

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If all this is being manipulated...what's the point of charts? No disrespect but, I think we need to know the "inside guys" for the dips and such. Of course, when TSHTF and Crimex is gone, then we'll see 200 dma be a thing of the of past...then it's time to sing "Rocket-man"...otherwise...I'm holding and watching.
Exactly. Stick with the fundamentals. That's what the buy-and-hold physical silver long term investors do. The TA guys get so twisted up in their terminology they forget the fundamentals.

Just look at the title to this thread. Silver "correction"?? WTF. Silver is manipulated DOWN. When sopt price goes down, it's not a "correction" at all. "Silver next manipulation" would have been a more apropriate title.
Sorry for the rant. :eek:
 

d-lod

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Only way to know is to assess if and when we get there. I'll be the first to admit I've been wrong about markets before. Some points are clearer and more sure than others. I'm still learning to only take action on those of the highest surety. I did buy everything I could in the $28 range on the second dip. Previous post outlined when I bought 12-14. Wasn't the bottom but sure could smell it from there :)

That is it, many on GIM will envy you for doing right, and it was made possible because of your knowledge of chart and technical analysis.
From the comments of posters we can learn how many times they have fathom the bottom and raided the top. I have personally lost my win, from 2007 correction and that is why I pay more attention now to correction.

Let begin the new era of next upward wave, should we continue with same thread or start new?
 

REO 54

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That is it, many on GIM will envy you for doing right, and it was made possible because of your knowledge of chart and technical analysis.
From the comments of posters we can learn how many times they have fathom the bottom and raided the top. I have personally lost my win, from 2007 correction and that is why I pay more attention now to correction.

Let begin the new era of next upward wave, should we continue with same thread or start new?

Well,being a new year and all,maybe you could "freshen it up" a bit with a new thread title,while keeping the old info.:D
 

REO 54

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Maybe just editing the title and keeping the thread.I dunno. I'm a fan of the thread for sure. What say Klichko,lightcycler and others??
 

lightcycler

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Most markets have manipulation forces. Stocks have the plunge protection team. That doesn't mean technical analysis doesn't apply or is unuseable. Sometimes the biggest use is to know when your analysis is wrong. Each person has to decide what is the best way to stack and this thread is all about technical analysis and D-lod and others have put forth very valuable info. Take it and use it or throw it in the trash as you see fit.

I guess I would say editing at the point when totally convinced the correction is over and the next wave up has begun.
 

hoarder

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Most markets have manipulation forces. Stocks have the plunge protection team. That doesn't mean technical analysis doesn't apply or is unuseable.
Other markets are manipulated for the purpose of making money off the manipulation, both upward and downward. Gold and silver are very different in the sense that they are manipulated DOWN for the purpose of keeping the dollar up and to prevent these metals from becoming and alternative to the biggest scam in the history of mankind; the Federal Reserve note.
 

d-lod

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Other markets are manipulated for the purpose of making money off the manipulation, both upward and downward. Gold and silver are very different in the sense that they are manipulated DOWN for the purpose of keeping the dollar up and to prevent these metals from becoming and alternative to the biggest scam in the history of mankind; the Federal Reserve note.
You must be hoarding the real stuff.
Technical analysis is different than manipulation. With satellite for every street, there can not be so much manipulation.
Chinese with eastern wisdom, are selling their dollars at higher prices and getting gold at lower prices. If you see currency stuff, it is only in USD that both metals were made cheaper at the price of Nov 2010, but in other currencies they were higher, nearly 2011 march prices. So swap was of USD and cheaper gold/silver.

It is never called manipulation, its called street smartness.

And about your unlimited experiences with manipulation, I would say, it is just technical analysis. This thread has limited posting and go through each one of that, and other previous thread by me. Except for previous correction, my analysis had stood test of manipulation.

I do not post when I do not foresee changes technically.
 

lightcycler

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When you say correction-how much of a correction do you mean?
More of a pause with a partial retracement of the move from $26 to over $37. Would not expect it to go below $30 at this point. Markets will always stair step and never in a straight line.
 

lightcycler

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I just want to say technical analysis indicated the silver market was overbought. People will jump on the manipulation bandwagon today on the smackdown. Technical analysis takes the emotion out of this and allows me to sleep very easy at night not being suprised by this move today at all.
 

hoarder

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Paper silver certainly is overbought. There's 10 times as much paper silver out there as real silver. Worthless paper to fool suckers.
 

GodspeedMetals

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I would like to state for the record RIGHT NOW...

We will experience price volatility - a zig-zagging, if you will, in the paper metals prices in the near future... and the distant future.

My testicles says so!

I meant technicals!!!
 
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hoarder

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Tinbox

YOU GET NOTHING! YOU LOSE, GOOD DAY SIR!
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Yup...you're very consistent.
lol do you have some kind of sick obsession with me? you seem to follow me around and make bizarre replies to my posts that I don't even understand the majority of the time.
 

GodspeedMetals

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I just want to say technical analysis indicated the silver market was overbought. People will jump on the manipulation bandwagon today on the smackdown. Technical analysis takes the emotion out of this and allows me to sleep very easy at night not being suprised by this move today at all.

Keep sharing with us, LC. I am curious of your interpretation.
 

GodspeedMetals

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lol do you have some kind of sick obsession with me? you seem to follow me around and make bizarre replies to my posts that I don't even understand the majority of the time.
C'mon TB. It's not personal. Hoarder's cool. Though he did email me my social security number when I requested it from the SSA. That sorta freaked me out.
 

lightcycler

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Really hoping dlod, kitcko and others won't backoff. There is strength in numbers and viewpoints. For those that don't buy into technical analysis what is your purpose in a thread about technical anlaysis other than to troll? Really doesn't bother me just seems like such a waste of time.
 

hoarder

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For those that don't buy into technical analysis what is your purpose in a thread about technical anlaysis other than to troll?
The purpose is to remind you that the validity of testicle analysis is dwarfed by the importance of the fundamentals.