SLW and ESLR broke supports and stops

DJIA

Volatility

Dow Plunges 350 on Unemployment, Factory Reports. Lots of panic headlines today. A definite 180 degree turn from yesterday’s, and another 180 from the day before. The flip-flopping sentiments of the media are just too funny. This is definitely a time of high volatility and uncertainty. Even at today’s “plunge”, the fact is, the markets are still up from last week. We could very well be seeing the bottom being set in this bear market. I think the worst of this downturn has unfolded in the past year already.

In any case, I am definitely a bit early in my long term entries. Both SLW (-15.6%) and ESLR (-14.1%) have broke support, but still far from 52-week lows. I am reluctant to sell at this time because the market is in panic mode. Yet, both prices are below the stops I’ve set for myself.

I would go long on SLW at this price if I had the fund. The indicators are on buy alert too.

SLW

Silver

ESLR

ESLR is more risky at the moment because although the price is off a lot, it’s still dancing around the 20 dma. It could very well break the 52-week low from here.

BOUGHT +166 SLW@ 8.82 LIMIT

SLW

Just before leaving for Taiwan on the 25th, I placed a GTC limit order buy for SLW at $8.80. The order executed on September 29th, 9:32am, at the open. I can’t remember the exact reasons for the $8.80 price point. I should post an entry when I do limit orders from now on just to be clear.

Silver

However, looking at the charts of SLW and Silver (YI), things are looking bearish for SLW. I will watch this position and be ready to exit as soon as needed or on a small bounce. It’s funny that what I believe to be my most “stable” company turned out to be the one I’m worrying about in my current holdings. I guess that’s a good sign as I’m not too attached to any company or having too much faith in them. Being skeptical and remaining critical of your positions are what’s essential in trading.

Fee $5

Upside: Still haven’t touched the 50 dma. Price is in trading range near the 52-week low.

Resistance: $9.0, then 10.

Downside: Indicators seem to be turning bearish.

Support: Round number $8.0, although the current price is already skimming on it. More likely $7.50, just below the all time low of $7.62

Bottom line: My signals have turned negative on SLW. I will try to get a good exit.

Gold and Silver vertical rise!

YG

YI

I actually had to double check my quote when I saw YG was up 80-something yesterday. Unbelievable! The move was attributed to the Fed’s take over of AIG with $85 billion for 80% of shares

It’ll be interesting to see if Gold can break $900 and hold it above that resistance. Otherwise, we’ll probably go into a trading range around $800 – $900 until Oil breaks $100 too.

Gold/Silver Miners versus Gold/Silver Price

Gold Miners vs. Gold

Silver Wheaton vs. Silver

Bottom for SLW can’t be too far off now… A good sign would be a capitulation when the miners vs. metal chart break the accending support levels.

SOLD -200 SLW @9.0415

SLW

Sold a large portion (200 of 368 shares) of my SLW holding today for a modest profit of ~10.9% in 2 days. (commission fee $5) Today’s jump in SLW seem overbought intraday and there’s resistance at $9.15 (intraday) and about $9.45 (from day chart). In particular, the volume seems to be falling on subsequent peaks of the day. It looks as though the rally is losing steam. The main reason for taking profit at this time is that the rise seemed too fast for SLW. It shot up 10% while silver (YI) moved only 2%.

Furthermore, today’s rise in GDX seems to be just covering the gap from a few days ago. Also, silver and gold still seem to be in bearish move despite the recovery. The prices are still within the down channel. Further fall in those prices seem likely in the medium term.

Gold Miners ETF (GDX)

Silver YI

Gold YG

I will watch SLW, GDX, YI, YG closely for an re-entry point.