[caption id="attachment_515" align="aligncenter" width="500" caption="mini Silver"][/caption]
[caption id="attachment_516" align="aligncenter" width="500" caption="SLW"][/caption]
Wrote some puts on Dec08 of SLW at 7.5 strike price. Fee \$7.5.
Upside: Volume on the rally from the low has been consistently high. Price of silver looks as though it has seen the low for now. Note the volume graph on 15-min YI price, the retest of last Friday's high occurred at lower volume, marked by yellow line.
Resistance: \$4 first, then primary at \$5. Next up is \$9 - \$10.
Downside: Week prior to election, rally not supported by volume on overall market. Earnings report on Monday. Commodities under pressure.
Bottom Line: Can't say for sure if we're at the bottom yet. The sentiment is definitely turning. By now til late December, SLW and the overall market should make a sizable rally. I will unload this then.
Stop: If on expirary I'm being put to, then I might just pony up the cash and buy the shares. Effective share price will be \$3.5.
: http://traderpau.files.wordpress.com/2008/10/2008-10-30-yi.png : http://traderpau.files.wordpress.com/2008/10/2008-10-30-slw.png