On 9/12 when Silver was priced at $32.50 and the Commodities
Index (NYSEARCA:DBC)was trading at $29.10, I wrote an
warning about the lofty levels of precious metals sentiment and
suggestedtaking profits. On 9/23 a Silver shortwas suggested
to our subscribers with price at $33.48. Since then price has
fallen 7% to $31.15. Where do we expect Silver and Gold to
Combining Sentiment andTechnicals for a Silver Buy
At the ETF Profit StrategyUpdate we use sentiment and technical
analysis to help us get ahead of markettrends. We did this
with Silver (NYSEARCA:AGQ) and Gold (NYSEARCA:UGL) inlate July when
sentiment was negative and price was holding support around
On 7/29 I was watching silverprices and informed our subscribers
in our Technical Forecast that, "The risingred short term trendline
support line currently just above $26 is also a goodstop loss spot
and support line to watch. Good risk / reward set ups suchas
these are what we look for in our trading."
accompanied thatcommentary showing the breakout, 200 day MA, and
trendline supportlevels. We also were watching sentiment,
which was at an extreme.
On 8/5 after that rising redsupport trendline held, I followed
up with, "For aggressive traders that arelong SLV I have identified
two good stop levels with the horizontal support at$26.55 as well
as the lower rising support trendline at $26.15."
Pricesrallied from there.
The opposite occurred inSeptember as sentiment shifted to
extremely positive after the large Augustgains.
Combining Sentiment andTechnicals for a Silver and Gold
Inour 9/23 Technical Update at a price of$33.48, we suggested a
short position on Silver (NYSEARCA:ZSL) due to sentimentextremes
and technicals. "A break belowchannel support would likely
target a larger pullback to the 200 day MA alsowhere the Fibonacci
support zone lies" we stated. We suggested stops above
that week's high price of $34. Silver presented a great
risk/rewardopportunity with a stop less than $1, but potential
gains of $3-$5. The following
accompanied that update.
What's Next for Silver andGold?
Todaywith Silver prices below $32, our first target of October's
S1 pivot has beenreached. The next stop for
Silver(NYSEARCA:SLV) is likely $31 where trendline, moving average,
and Fibonaccisupport resides. Gold (NYSEARCA:GLD) isin a
similar position, but showing relative strength to silver which
likely means it won't fall as far.
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