When I have a possible support level - as you mentioned it is in your target area I use it as an IF THEN level.
If it goes trough it by more than say $2 THEN the direction is downwards.
IF it bounces off it and closes up by a certain amount THEN the direction is upwards. So I wouldn't buy right at the low but more conservatively above the low.
Also the fall has been fast and we haven't really had enough time to digest it. So you can expect quick rallies and declines. If there is a new advance it is likely to not be as sweet as the first one (see the post at the beginning Hi-ho Silver away!). This time there will be people who were burnt and less quick to jump in a second time.
What size of move are you looking for?
What time frame to you hold for?
Are you trading futures?
Good trading to everyone.
The following user says Thank You to aquarian1 for this post:
I'd shy away from technicals right now on Silver.....
We're still not out of the fundamentals yet.
Soros just dumped all of his assets in Gold. Goldman Sachs has doubled their holdings in municipals....
Other nations are starting to cry uncle with respect to monetary policy....
What do those things tell you? It tells me that there's an increasing likelihood in interest rate hikes....
Obviously the price of commodities have eased and the strength of the dollar is seeing some fresh air, but Bernanke never really payed attention to those things anyway.
When Soros, who's now a political hack, pulls out of Gold, that tells me he either thinks the run is over, or he's got a direct line to Obama and Bernanke (in exchange for the $Millions he's donated to advance his liberal agenda) and he knows something everyone else doesn't.
Combine that with the GS holdings and it's starting to look like a rate increase.
So the only fundamental left to prop up Silver is the tech industry demand and given the "sell in May and go away" nature of things, I don't think the Summer is going to be nearly as good as the last 2 quarters for earnings or revenue.
That means if you're trying to apply technicals to a market that's funadmentally changing, it's a good way to get burned.
I would say you'd be better off looking at the whole number phenomenon and placing small profit targets based around those. People love numbers like 35.00 and 30.00 where it will test, give hope to some and then retest/breakthrough....which is exactly what it looks to be doing with 35. This thing smashed through it's 50 day like a freight train and I think it's on it's way to 200 easily.
The following user says Thank You to RM99 for this post:
Couldn't agree more about a smaller timeframe being needed for Andrews pitch fork.
Unfortunately, stockcharts dot com doesn't offer anything less than daily and I don't do much e-mail or go to websites with the trading computer.
NT does have the pitchfork so I'll learn how to capture the screen image and use that for here.
I use the pitchfork like BB's to to gain confidence in direction. What I need to start doing is using it like trendlines and S/R lines on the NT function that lets you draw on one larger time frame and have it appear on a smaller one.