Sinking treasure or screaming buy? : Silver

By Mike Cichocki – TradersBase.com

Is Silver a sinking treasure or a screaming buy? Below is my analysis of the current situation Silver folks are facing.

Silver futures Monthly Chart

Click the image for full a full size chart

 

 

 

 

 

 

 

 

 

$28-30 is support, meaning a prior price range where demand came in and purchased.
$34-35 is resistance, meaning a prior price range where supply cleared out and liquidated.

The macro trend depends on your style & how you measure. If you use swing levels silver is still up-trending as long as $28ish holds. If you focus on momentum however, silver has stalled and actually violated the slope of the up-trend. The mid term and short term have undeniably been heading down, regardless of how you measure.

The aggressive play is to enter at support despite the current down trend, this is a high risk entry.
A less aggressive play is to wait for signs that support is again being defended, candle formations showing price contraction for example.
The least aggressive play is to wait for an uptrend to emerge in the short or mid term.

My best advice is to gauge your appetite for risk and set a plan you can live with. Execute the plan without emotional interference, relish success & learn from any setbacks!

MC

About MC

I specialize in Market Profile/Volume Profile and the 2 way auction though I'm far from a 1 trick pony. I have trained heavily in almost all aspects of Technical Analysis. TradersBase is my way of sharing my knowledge and experience with others in hopes of cutting down their training time and getting them on the road to profitability while minimizing bumps in the road. Note: Any advice or information I provide is to be taken at YOUR OWN RISK. I take FULL responsibility for my trades and my own risk capital and insist you take the same approach. There is no "invisible hand" in the markets and losing trades are to be expected. The market isn't out to get you, but it will devour you if you don't plan properly.