Friday, December 10, 2010

12.10.2010










Big Day today. There are a few updates and one final closing update at least coming. Adjust to the message of the market during these times. All times Eastern




Update 12:13 - Im off to lunch after this. The move is to the Ten average. This is big on what happens here. I said earlier, Its ok if it bounces off of this. If we can hold this rally giving up to 61.8% of this back then it has better chances of breaking this ten day average. If this fails the battle will turn to the Five and Ten day moving average teaming up as resistance going against the twenty day moving average and the VWAP from the November High level. If it gets above the ten day average here then its back to the Five versus Ten game.



Update - 12:03 - The failed move on the failed move created a fast move to a new high not seen since 8:45am today. I hope its not a failed move to a failed move to a failed move, but it can be. Sorry to confuse you (if I did and I should have), but the jargon I have stated is because the inv H&S pattern broke up and then a hard move lower below neckline support. It held those areas mentioned and had a fast move to $28.67. This was a gain of over one percent in a range of 7 minutes. As I am finishing this LOG at 12:06 it is consolidating the gains. The pattern for the H&S was to the 70-71 cent handle and like the $31.75 hit on the long term time frame, this is a small pierce below on the short term. This is not to say it can not go back there and thus also extend its gains.



11:50a - From failed moves can come fast moves Brian Shannon has said on many of his videos, and this looks like the case on a potentially failed inverted head and shoulders breakout. This pattern is only for the shorter of time frame traders, but as I make this at 11:53am, Silver broke $28.37 and then it fell back down. It needs to hold two levels right now which are $28.25 as the level that has been established over the last half hour or so as well as $28.20 which was the resistance shortly after 10AM. Overall, it might be one of those it is time for lunch deals. It's friday and its a down week for the metals with the exception of Copper. The JPM Morgan buying physical has a lot to do with this as they added this ETF which is actually backed by Copper. I laugh when they try and say "Hey folks, this ETF has real assets", meanwhile the crew on the staff have all these great feelings because they are doing the right thing. The reason I laugh is not because I don't believe them on the ETF being backed copper, but more so that it shows how all the others are not this way. I guess if they could back SLV with real silver and GLD with real gold to the quantities they have out in shares. Do I think for every share of SLV that there is 0.97 ounces of Silver some where? Do I think for every share of GLD that there is 3.06 grams of Gold to back it up? The answer is no and these figures are based on the share size ratios. It might be a right step to do the right thing and back this ETF by real copper, but if you want to make more right steps a move to fix the Gold and Silver (and all markets) would be essential for there to be an economic recovery. Thats my two cents (or two grams using silver).




10:30a - Silver is still holding well as it has held above $25 and the market has had some time to digest it's gains that it is had over the last few months. On the short term it has managed to come back to the 28.00 handle where support was found last Wednesday. The battle between the five and ten day average I pointed out last night seems to be won by the break of the ten average. This means with any rally that occurs from here on in on the short term time frame that the ten and five day moving average should be resistance. On a bullish case, that is fine for this level to stop a rally and bring the market lower. What would be important when it touches this level is for the market to make a higher low and then take out the important issues. The twenty average is current at $27.61 and if we break this $28 handle then this is where we are going towards. I'll be back later with another update

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