The long term (several year) cycle is very bearish for Silver. In several years time, my target would be approximately $5. However, that would be the start of a long (many decade) impressive bull market in Silver. I'll explain this further at a later date.
Silver might see a quick little pop, and that presents a nice spot to short. The first bottom at $28.50 might be as soon as Tuesday, May 24th.
4hour Chart
SC Is your target for the low 1200's coming in early June?? SPX
ReplyDeleteI'll show some calculations for SPX targets and timing more in depth soon. In terms of timing, I think hard down (even if Monday is a bullish open), and a first low for SPX might be around Tues, with a rally into the end of the month. The first week of June appears to be a large plunge with a low June 6-7.
ReplyDeleteBasically commodities have not capitulated yet from the early May selloff. Financials have been leading down for a long time already.
ReplyDeleteThese 2 factors alone make the case for an SPX freefall rock solid. SPX needs to catch up with where commodities and financials are already trading.
I can't picture what event would cause a near $10 drop in silver by Tuesday. It looks more likely a test of the $34 area if it does drop.
ReplyDeleteWould have to be the big drop in the S and P
ReplyDeleteSC, only thing preventing sharp silver sell off is gold being perceived and (so far) traded as a safe haven play (although gold/silver ratio is moving higher, it's indirectly holding silver up). In addition, non commercial spec activity on silver is reaching new lows, which might imply little further downside here.
ReplyDeleteOn SPX, well, too bad we're not getting the early morning bounce to short some more. As for targets, I see no lower than 1280, then we bounce from there and, as you suggest, a further (larger) drop might be on for the first half of June.
Looking forward to your further comments/analysis/charts. Thanks!
I feel as though it is likely for a rally in gold here, and that will pull silver with it. Maybe the rally will only take 1 or 2 days, but seems likely to me at this point.
ReplyDeleteMy thoughts this morning are that we may test 1312 SPX, but then bounce to backtest my pink line from the last SPX chart at 1326. After that then more downside to 1294 area or lower.
ReplyDeleteFor Silver I also like a small bounce here. I have not shorted it yet, and would like to see a $1.50 or so bounce up to present a short entry. If it bounces today then maybe tomorrow is a selloff?
Let's see how silver shapes up - slow so far. Timing is tricky because it does act as a safe haven at times. Maybe tomorrow is just a minor low with a $1.50-2 bounce coming, and then the selloff down to $28.50 after.
ReplyDeleteThe main point is that it needs to capitulate imo before it can see a stronger bounce. No matter how I look at the timing, I like a major low first week of June around the 6-7.
it is definitely hard to call at this point
ReplyDeleteFinancials are closing near the lows of the day. They have taken out the March "Japan" lows. That indicates more downside for mkts tomorrow.
ReplyDelete