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Trading Lessons

SILVER Window of Opportunity @ $29.68 – $26.23 by Jan 18 2013?

Commodities / Gold and Silver 2013 Dec 16, 2012 - 02:11 PM GMT

By: Joseph_Russo

Commodities

The following is a quick update to our Silver Lining report from October 21, 2012.

The daily chart below illustrates the latest price action in Silver. From the secondary lower high at $34.39, the trend has been down for the past 11-sessions, setting a print low on Friday at $32.22. As such, Tuesday marks session-13 from that secondary high, and offers the potential for marking a short-term turn-pivot low.



Take note that the market is trading just beneath a broken speedline of support, and has breached a fresh sell trigger trajectory citing 6-pts of downside to the 26.23 target.   

Circled in blue after successfully tagging the highlighted 31.68 target in route to the 30.65 trough following our last article, this chart also implies defense of a 29.68 downside price target with a further downside support window shaded in gray between 29.61 thru 26.65.

Although a window of opportunity exists through January 18 to buy at levels 15%-20% below the current price, the much longer-term buying opportunity remains here and now, and all the way down (if you’re lucky) - to the 26.23 level.  Once the minor degree 2 wave bases, it is onward and upward, and off to the races.

We continue to illustrate support for a medium-term upside price target of $47, which shall remain defended so long as the market holds the summer low at 26.07 and maintains closes above the falling green trendline trajectory so noted. 
Above the market and now just north of $34.50, we continue to illustrate a resting 10-pt buy trigger, which is contingent upon price breaking out above the trigger, along with sustained trade and closes above the triggers falling green trendline so noted.

Despite prospects for a substantial decline over the next month, what would kill this extremely bullish long-term opportunity?  In the larger sense, nothing - because no matter what paper prices convey, one still needs to have a 10-20% portion of one’s net worth in hard money in the form of physical gold and silver.

In the strategic and technical sense however, if the anticipated decline is a smaller degree 4th wave, a print below 28.37 would mark a (ko) or key overlap violation of the first wave up at subminuette degree. 

If the anticipated decline is a larger degree 2nd wave, the next sign of failure would occur upon a print beneath the 26.07 low, although this would simply imply a more bullish shift-right and lower level terminal base for an even larger degree wave (4) base.

Since fifth-waves tend to extend in the commodity arena, and that Silver is at or nearing a minor degree 2- wave decline, one must not ignore the possibility that Silver's intermediate (5) of primary 3 wave can easily extend well north of $80 per ounce.

On the Massacre in Newtown, CT USA
This weekend, the entire world is in a state of shock and despair.  

We are all morning the senseless execution of innocent men, women, and 20-children at an elementary school in Newtown CT USA, my home state.  In fact, I was in CT on an unplanned visit to help my brother care for my aging Dad when the news came across the wires.

I got to thinking that if the Federal government prohibits firearms at designated venues, then the Federal government should provide and pay for metal detectors along with the required security personnel to prevent the entrance of ANY firearm onto the property of such designated venues. 

In failing to do so, the Federal government is by default, creating easy targets for lunatics and Manchurian candidates of every stripe to march right into these 100% gun-restricted venues and impose widespread terror and devastating loss in the blink of an eye.

Thinking further however, the problem with such a solution is that “we the people” pay for and suffer at the hands of all such government dictates and impositions.  No free person of sound mind wants to endure the levels of totalitarianism that come with living under that type of police state.  Unfortunately, ever since 911, we are edging closer and closer to such conditions with each passing year.

Although there is no easy solution for stopping a maniac with a loaded gun, if we trained adequately a significant number of professional personnel and private citizens in the safe and effective use of firearms, when random lunatics suddenly appear and start spraying bullets, the chance that someone will effectually oppose the assault with equal force would grow exponentially. 

Though one could not guarantee zero fatalities amid such random attacks, one could safely assume that with enough trained and authorized personnel/citizenry bearing arms effectively, it would minimize greatly the massive number of fatalities possible in such an instance.

Although such a solution could never alleviate the devastation and loss of even one single innocent life lost, at least it would provide a fighting chance toward preventing horrific mass killings like the one that happened in Sandy Hook Connecticut.

If big government engineers a mandate to start a “War on Guns” via the legislative process, you can bet your last dollar it will prove just as effective as its multi-generational “War on Drugs.” 

Our hearts and prayers go out to each of the innocent souls lost and to their families and friends who shall forever grieve the permanent absence of their precious loved ones.

Trade Better/Invest Smarter

By Joseph Russo

Chief Publisher and Technical Analyst
Elliott Wave Technology
Email Author

Copyright © 2011 Elliott Wave Technology. All Rights Reserved.
Joseph Russo, presently the Publisher and Chief Market analyst for Elliott Wave Technology, has been studying Elliott Wave Theory, and the Technical Analysis of Financial Markets since 1991 and currently maintains active member status in the "Market Technicians Association." Joe continues to expand his body of knowledge through the MTA's accredited CMT program.

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