top of page

The weekly debrief


Examining the weekly silver chart below::


trading is all about abnormalities/edges


the purple line represents the simple moving average with settings 200


what you find as a commonality is that over the last 2 years price each time when approaching the 200 SMA holds


it might break at some point as well but the attractive aspect for a trader is that it at initial approach holds


(and no,against common myth, not all time frames or instruments abide to the 200SMA)


after such an initial discovery of a behavioral abnormality of price it's time to work on various scenario of how such a atypical behavior of price can be exploited to ones advantage


the most obvious edge from a high likely holding point is partial profit taking if one is in a position


=and in turn, risk assessment on how far a trade might move before a trade entry


one can also lean against this=low risk entry point


and the importance here is that we are already at a higher time frame where advantages like this are harder to come by, which provides for a guide line of lower time frame entries


next step is to zoom in and observe specific price or time pattern behaviors on the various recent turning points and the price behavior near the 200SMA :



we find ourselves here in a sideways channel since May of this year and the multiple contact point towards the 200SMA is degrading the value of its edge by a small percentage


the last two weeks were the first to break the overall range warranting a bullish tendency of price


typically at this point it can be useful to look at the zoomed in recent past without the specific edge examining for otherwise typical or atypical behavior:




in our case we find price retracing after a first leg up from a triple bottom support, right at the mean (blue center line)


another confirmation that we find ourselves in a possible larger time frame (monthly) bullish turning point


from here on out it is a productive next step to zoom out the next higher time frame in this case the monthly one:




a closer look shows that after a lengthy time of contraction silver briefly dipped below $12 to than expand rapidly nearly to $30

over the last two years prices traded sideways to down and found recent support near the $19 price zone


we find ourselves in a advancing month so far but the strong overhead at $22 was successfully defended so far by the bears


since prices bounced at a strong support zone where we took advantages with low risk entry plays the overall picture is one of sideways to up


once the edge time frame (in our case weekly) is set in relationship to the more dominant larger time frame (monthly), again a "zoom in view" (daily time frame) can be very useful:




the daily chart shows an upsloping linear regression channel confirming a slight bullish note


it also shows two successful trend legs long from mid of last month, followed by a modest retracement in the last 4 days


an equally healthy sign that bulls have gained a sense of control for the time being


in conclusion we find the rare occurrence that the bullish note is present throughout all time frames


while a turning point might be immanent, if silver can hold its price level it is trading on right now throughout the end of the month, we see no inclination to aggressively short a market which one of the very first seems to get a foot holding right now but rather reload our core long positions in silver on half size on low risk entry points

Comments


Stay Up-To-Date with New Posts

Search By Tags

bottom of page