… And The Bulls Are Trapped
As we’ll show below, this morning’s action in SLV, has confirmed the reversal; a Wyckoff up-thrust, pointing silver’s probability to lower levels.
For starters, let’s recap on how this (trading) game is played.
That is, the public i.e., the masses, need to be led to and fro so they are continuously on the wrong side of the trade.
So it is with precious metals and specifically silver.
The media came out recently, effectively telling everyone ‘Now is the time to buy gold’.
Where were these guys in 2001, when gold bottomed around $271/oz.
No, they show up at the end of the move … not the start.
Public Buys Hype, Not Facts
So the public has bought into the hype and run the silver coffers dry. Everyone excepts an immediate currency collapse and certainly anything can happen.
The original (bullish reversal) analysis is now supported by the facts; it’s been nearly two-years since that post and the dollar (UUP) is still headed higher.
So, let’s find out where silver is likely to go. For that, we go to the weekly chart.
Silver SLV, Weekly
The set-up, already posted; Spring-to-Up-Thrust.
It’s a repeating pattern found across the markets.
Price action gets itself into a spring condition by penetrating support which subsequently sets up the reversal; the up-thrust.
Next, we’ll use the Fibonacci Projection Tool, showing likely areas for downside destination.
A full 1 : 1 projection gets us right back to where we started the whole ‘short-squeeze’.
If SLV, gets back down to the 10.50 – 11.0, level, one can only imagine what type of hype will be in vogue.
However, at those levels, it’s reasonable to expect the local bullion dealer will be begging for sales … they might even offer their product at, or near, spot. 🙂
Charts by StockCharts
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
The Danger Point®, trade mark: No. 6,505,279