New to trading silver ? Silver News Rally may not appeal to the professional trader. We are about accumulating silver and giving market manipulators a run for their money. Trade silver at your own risk. Share this blog if you care for the little guys in the world that revolves around money and resources which are by nature and the higher purpose of being human the domain of all and not the domain of asset and money managers
At the end of July 2012 xagusd is trading within the 26 to 29 range.
This image compares a daily chart of the eurusd with a daily chart of the xagusd.
Generally the two assets have moved together since January, however eurusd has been much move noisy and much easier to trade in small cycles.
What will make the silver usd break out above or below the recent 26 to 29 range ?
While there is no guarantee that the two pairs will continue to move in the same direction, history indicates that if the euro finds support then so will silver.
Thursday August 2, 2012 is a key day when Draghi of the European Central Bank is expected to make news about the ECB putting weight behind to Euro or allowing the markets to determine the faith of the European economy.
In other words investors and bankers are fidgety about Draghi and the ECB using the quantitative easing card this week or this month. Failure to do so will likely send the euro ( eurusd ) down to retest 1.20 and more likely 1.18. That same action will send the xagusd contracts below 26.
If Draghi allows a large cash flow into the free and open markets ( lmao ) then the eurusd will likely rally to somewhere above 1.25. My likely guess is 1.27 and maybe pressure to 1.30.
If that happens then xagusd will follow the direction in a similar rally. I use rally loosely here, since I believe any xagusd move upwards will be a fast and furious spike. Where to for the xagusd ? Half point recovery since January 2012 is about 32. Full recovery hits 35 and a blast into the past could test 45.
The last day of trading this second week of July 2012 is Friday 13.
Silver spot traded in a range between 26.5 and 28 all week long and the silver chart shown here shows the results.
There remained much speculation about the possibility that some countries would soon start releasing money into the banking system in order to stimulate national economies. This speculation of quantitative easing might have been the catalyst that held the price of silver from dropping below the triple bottom 26 level.
Another factor that may have held silver above 26 might have been the par with expectation economic data that came out of China. Par is better that negaive. Should a few more par of better than expectation data reports come out in the next weeks then this might also feed the bull silver buyers a jolt and send the silver price rallying to 29 or 30 or maybe even higher iif and when.
On Friday 13 that is how silver news rally interpreted the week of silver trading.
Click on this july 2011 2012 silver chart to enlarge
Compare the july 2011 2012 silver chart to the following 5 year chart.
Our 26 or 29 post made last week played out almost exactly as we had said it would.
Early in the first week of July 2012 silver started trading lower than the open and seemed to want to go to 26. Mid week the sentiment had shifted and silver buyers were moving the price which peaked at 28.5.
On Friday, July 6, all kinds of economic reports failed to prromote a stronger economy and the price of silver spiked back towards 26.
The 5 yr chart shows the potential upside should silver break through that bearish vertical channel which has big support and resistance level at the current price of 28. Then again at 31. The high of 48.48 set as the peak of the bull silver rally which broke above 20 in 2010 is a nice top to hope for if a bull silver rally comes to pass in the last part of 2012.
However!!!
A test below 26 would certainly make sense here since there are likely tons of stop orders that could be hunted out of play at that level.
However if the silver price does go below 26 then how are we to know that it isn't a genuine market sentiment and not just a stop hunting strategy ?
Again, from looking at the 5 year chart we see how deep a bear silver ratlly could go. There was a big range between 10 and 20 that lasted for several years and which was broken out of in July and August of 2010.
So basically we have been experiencing silver above 20 dollars US for 2 years alreadly.
It is unfortunate that my audience counts myself and well......myself, since this information contained in 9 or 80 silver could proove very valuable to someone who took the time to read this post.
Why?
Go figure, the guy who made the attached video which predicts that silver will skyrocket to 1000 usd or more in the near futre may be completely off his rockers.
However !!!
Take away his over optimistic assessment of the future price of silver and the rest of what he says about silver and the accumulation of silver may not be that far off the truth.
And...in the end he may not even be wrong about the super inflated price of silver should the global financial system continue to chase a reality that more and more people are coming to believe does not and will never exist.
What reality is that ?
Well, some people believe that those who control money would like nothing more than to believe and have the rest of us believe that by allowing them to continue to be the money managers and wealth distributors of the world that somehow they will make the world a better place. The fact is that to make the world a better place as per their standards which state that they must earn money on every transaction that goes on in the world......well you know that story.......
As for the 9 or 90 silver topic of this post what is important about the video is not the part where the guy makes 1000 dollar silver cliams that could easily send some people in a fantasy frenzy. What is important about the 9 or 90 silver video is the statement about how everytime JP Morgan Chase Co is forced to sell the silver spot market in order to not lose billions of dollars, the billionaires of the world meanwhile go on a buying frenzy for silver bullion and coinage as the price goes down or remains low and affordable .
Think about that for a few seconds and you may agree with me that the billionaires of the world likely participate in shorting the silver spot market, through their brokers and agents, just as much as JP Morgan does. They likely also buy long silver paper contracts when appropriate. And all the while they keep stacking or buying all of the physical silver that they can find or afford without over leveraging themselves.
Why ?
Because if they can play the paper silver game with JP and his friends they can be a part of the group that manipulates the low cost of silver. If they lose and gain similar amounts on their short and long silver contracts it is not a big deal because most of their money allocated to silver is actually going to buying physical silver - in other words the wealthiest people are hoarding physical silver at any price like the guy in the video says. ( or any price below x dollars where x is ??? 50 usd ? 60 ? 90 ? ) . At some point they will stop shorting the paper contracts and watch JP and his friends take the fall they rightly deserve which by the way is not going to be a good thing for the rest of humanity. At least not a good thing in the short term.
JP Morgan and the agents of the boinkers who bought Bear Stearns back around 2008 meanwhile are likely a little worried about the price of silver going up and up and up since the company name is at risk. The independent boinker who works the JPM portfolio is however not much worried about the outcome since, as an insider, they are likely using much or these big salaries and comps to load up on silver bullion as the mother ship struggles through the impossible bottle neck.
JP Morgan under any otther name would definitely not be JP Morgan and senior JP would likely rock the spirit world should his namesake fail but to the current people who man the JP Morgan Ship ( the White maybe ) another bank founded in the future when the JP Morgan dust of failure has settled, founded under a new name but by the same boinkers would do just as well if the endgame was to procure the world with a same old, same old crap system of weatlh management and distribution.
If you read this then I feel good.
It makes two of us.
If you read 9 or 90 silver then you might also want to read 26 or 29 silver which was the short term struggle for silver spot contracts at the end of June 2012.
The xagusd chart has simple sma 60 and 100 added to it along with a basic moving average convergence divergence indicator.
A one minute chart is only tradeable if you are willing to sit and watch the trading platform for hours on end. However, what works on a one minute setup chart will generally work on a longer timeframe. Trading charts is a fractal thing were scalability is the key word.
As above so below.
What do you need in order to enter a trade if you are a technical trader ?
You need a signal and you get that signal by using one or several technical indicators. On this particular 1 minute silver setup chart the quoted price starts printing below the 100 and 60 ma's and drags in the bear sector.
There are two points on this 1 minute silver setup chart where the MACD indicates weak reversal efforts which some traders might be tempted to use as buy points thinking that the bear rally is oversold and complete. I consider those MACD points as false starts and prefer to wait at least until the spot silver quoted price test the 60 sma. At that point I look for the next MACD signal.
At this point I can enter a trade, long silver in this case, and, depending on my strategy, I place a sl order below the last low. ( I hate stop loss orders mainly because I believe in the idea that there are some amongst us who would manipulate markets in order to win at all costs ). There are other methods of beating the fear and greed factor that comes from some people trying to force sense in the markets.
Having entered a trade on this 1 minute silver setup chart at the indicated area, the next step is easy as pie. The trader has to look for an exit point.
One potential exit point is indicated on this 1 minute silver set chart. There are other exit strategies.
This study is for educational purpose only. Use at your own risk and if you dare. And try it on other traded assets. If it works out for you please come back and comment about it.
I will be adding other examples of this 1 minute silver setup as time goes by.
