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5 "Tells" that the Stock Markets Are About to Reverse

Gold and Silver Analysis and Trading Special Report

Commodities / Gold & Silver 2009 May 04, 2009 - 12:36 AM GMT

By: Chris_Vermeulen

Commodities

Best Financial Markets Analysis ArticleGold and silver have been making a nice controlled pullback since their high in February. With precious metal prices drifting lower making clean looking waves like these it’s generally a sign of profit taking before another move higher.


In my opinion the broad market is over bought and has been for about 2 weeks. With most sectors Bullish Percent Charts at levels of previous intermediate tops (4-6 week cycles) it’s important that we tighten our stops on current trades and be ready for playing the down side for broad market equities.

When the board market starts to slide I expect to see money move into gold, silver and precious metals stocks. I do not think we will see a huge slide in prices for the DOW and SP500 but it’s very likely we could see prices pull back 10-15% from these current levels.

When people start to panic and worry about prices dropping again, money will start to flow back into gold and silver. Both of these metals are great to trade but I would like to note that silver is not as widely owned as gold, so it tends to move a little more freely. When money moves in, it surges higher and when money is pulled out of the metal it drops like a rock. A great fund for trading a combination of these metals is the CEF fund as it owns both gold and silver bullion (57% Gold, 39% Silver, 4% Cash).

Silver Bullion ETF (SLV)


Gold & Silver Trading Conclusion:
Trading these metals has been more difficult the past few months due to volatility. It looks as though the markets are starting to settle down. Currently gold and silver are trading in the mid to upper area of their resistance trend lines which means buying at this level carries much higher risk if the trade is to turn and go against you.

Knowing when to exit a trade your trade is one of the most difficult tasks of trading and the part 97% of traders do not do correctly. Protecting your money and or gains is critical. Many times I will exit trades at break even and try again on another setup instead of watching a small winning traded turn into a losing trade.

That being said those of you who are buying at these levels be sure you know your exit points and stick to them. I’m expecting a big move in gold and silver but it could go either way.

If you would like more information on my trading model or to receive my Free Weekly Trading Reports - Click Here

I have put together a Recession Special package for yearly subscribers which is if you join for a year ($299) I will send you $300 FREE in gas, merchandise or grocery vouchers FREE which work with all gas stations, all grocery stores and over 100 different retail outlets in USA & Canada.

If you have any questions please feel free to send me an email. My passion is to help others and for us all to make money together with little down side risk.

To Your Financial Success,

By Chris Vermeulen
Chris@TheGoldAndOilGuy.com

Please visit my website for more information. http://www.TheGoldAndOilGuy.com

Chris Vermeulen is Founder of the popular trading site TheGoldAndOilGuy.com.  There he shares his highly successful, low-risk trading method.  For 6 years Chris has been a leader in teaching others to skillfully trade in gold, oil, and silver in both bull and bear markets.  Subscribers to his service depend on Chris' uniquely consistent investment opportunities that carry exceptionally low risk and high return.

This article is intended solely for information purposes. The opinions are those of the author only. Please conduct further research and consult your financial advisor before making any investment/trading decision. No responsibility can be accepted for losses that may result as a consequence of trading on the basis of this analysis.  

Chris Vermeulen Archive

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