Silver Mid Day Thursday

In yesterday's blog we discussed that if silver could not get back above 36.50 ---and a break below 35.20 would keep the pullback in play. We discussed the 34.75 area as an important area that needed to hold --- and today's low at 34.70 ------where silver traded for only ONE MINUTE below 34.75 is close enough to make it a good call. For now ---as long as price holds that low today ----look for a bounce back above 35 --- and We'll see if that can hold in the Friday Asian session. We can see that today's test is only a test of the lower red channel line. As long as we hold 34.40-34.57 today --- a bounce into the close should be sustained as the market gears for the Saudi event tomorrow. WATCH THE AFTER HOURS New York market ----- that is where volumes are low ----and where shorts can attack.

8 comments:

Louis Cypher said...

Y'know if I was WB I would ride this puppy down to support and then flip it around.

Just sayin' they did say the possibility of going short was there and physical was where you would be safe.

No POMO tomorrow.

Hopefully the Plunge Protection Team has a few Bernanke coupons to play with.

Warren said...

I agree Louis - seems it's exactly what they are about to do (WB crowd).

Update from the daily life trenches - wife gives father in law a 100oz silver bullion bar in return for recent loan .. discussion ensues. Generally liked is the fact that the bullion is now worth more than it was 12 months ago. Concensus (quote): "why didn't you put $x into it at the time? (instead of x investment)". Hmm. Final recommendation from father-in-law (paraphrase): "I looked into the price, it's had a good run but doesn't look like it will go much further.." consensus (from them): Best move would be to sell all now and put it into a term deposit - at least that way you are guaranteed a return of 'x'. Quote from wife (actual words): ".. well we have some in property .. we have term deposits .. and you can fuck around with the silver".

DEATH, EMBRACE ME. Any other stories of a silver bull married to a sheep? This is not working well :(

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Still monitoring FOFOA, Some good stuff from 'costata' long-time contributor and supporter of FOFOA. Didn't previously realise he was pro-silver.

Louis Cypher said...

Tough one Warren. How about a compromise? Sell half. That way you have locked in most of the profits and you are playing with the houses (JPM's) money.

This is why I don't tell the Wifey any tin foil hat stuff. It would make her nervous.

You accept that most people are deliberately turning a blind eye to this stuff so you have to accept your Wife wants to do the same.

It's tough ... I have been telling my brother for years now to at least but a a few thousand bucks worth of silver. No Dice.

I told him 2006 to sell his Condo. No Dice.

I told my Mother not to buy a house in 2007. No Dice.

On and on.

sierra_hpbt said...

ya know its funny.. My 2 brothers and my mom and dad are all onboard. My wife likes the idea but constantly says, we have good money now in those calls. (38.00 may silver call options).. they would pay a lot of bills.. yadayadayada..
thankfully she does not demand a sell.

Louis Cypher said...

Can anyone give me a logical explanation why bonds are up?
I can only assume 2 things.
Benny Buying or
When people are selling their stocks their money is on autopilot to be parked there.

JC said...

LC,

Below is a comment I made around Feb. 8-9 on Harvey's, Turd's and your site. It contains a theory I had about the FED's intentions that may be taking place as we speak. In addition the what I said below, this action by the FED would go a long way in creating organic purchasing of T-Bills and driving down the price of commodities.


"Thank you for your continued hard work. I believe JPM is not accepting GLD as collateral for margin accounts. They know full well GLD is a shell game. As investor redeem shares for the physical, do these shares get retired or are they resold with no new physical metal to back it up?
I have another thesis on the FED. It would seem that they are stuck with a huge issue on many fronts including balance sheet exposure to rising rates, derivatives blowing up the banks, commodity prices running rampant and US debt service going through the roof. Man, I don't know how he sleeps at night, but I think they have a plan. It would appear to me that this whole run up in the stock market will be a catalyst for the biggest bond buying binge you may have ever seen. What happens when the stock market starts to go south, most investors take flight for safety in US bonds. This typically drives down the yield. I bet in the near future we will see the biggest sell off of the stock market creating a flight for "safety", probably timed with some announcement from the FED that they are starting up a program to sell off their balance sheet of investments. There is a reason Bill Gross is buying MBS hand over fist, in the near future the interest rates on the bonds he holds will be higher than what is available. He will sell at a profit. Oh yeah...forgot about the muni bond problem. This scenario certainly helps the states and cities with this problem as well. Seems a watershed sell off on the stock market would send people running for "safety" (i use this term loosely) into the bond market. Thoughts?"

I would view any drop in commodity prices as an opportunity to initiate or add to positions in PM stocks and oil related stocks as the Middle East blows up and the finanical system is on the verge of blowing up again.

Due your due diligence and practice good risk managment.

Jack C

Louis Cypher said...

Thanks Jack,
Still digesting what you have said.

JC said...

Look for weakness in the SPY around $132-133 level next week. If this plays out the dollar will strengthen and commodities will sell off with the market funneling money to bonds. Developments in Japan could change things as the nuclear reactor is now experiencing radiation levels that are 1000x more than normal and preasure and tempurature is rising. Nuclear meltdown is feared and more earthquakes are could further impact the area. So far 109 aftershocks off the coast of Japan.