Thursday, September 26, 2013

Gold and Silver Buy Call

Silver Trading call :

Buy Silver Future near $20.50

TGT : First target for now $22.06, further TGTs will provide later

SL : A daily close below $19.64

Buy Gold Futures near silver lows.

Happy Trading.

Wednesday, September 25, 2013

SILVER COT REPORT : September 20, 2013 Commercials Added 6M oz Net Long

Silver COT Report 20/09/13

Commercials continued their pace during the reporting period and moved 6.22 million ounces towards becoming net long.
Large speculators cut their net long position by over 10.10 million ounces towards becoming net short.
Small speculators moved around 4 million ounces net long. 

After the COT week, we saw a decline into the support zone of $21.40 range but on low volume.

Friday morning saw a minor volume with almost 3 million ounces,  and prices slipped down from $23.16 to as low as $21.67.  Price is now at about $21.65 after forming a low of $21.20 this past week.  This volume and movement is showing sustained interest in buying silver at slightly higher prices and is symptomatic of one or more traders with deep pockets believing a bottom could have been made and seeking to take advantage of it.  My guess would be this was a hedge fund rather than a commercial player because if the commercials knew the bottom was in they would have bought far heavier.

Thursday, September 19, 2013

Silver Outlook Sep 20, 2013

Sorry to those who took long position on my call at $21.40. Just wanted you guys to be safe from effect of FED's announcement. So now again its time to enter

Silver Future : Buy is the call and sky is the limit.

Buy here at $22.93.

TGT:- 1st- $30.42 (within 6 weeks)

SL :-Weekly close below $21.95 (though I don't think Silver is in down trend but its just for safety)
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Wednesday, September 18, 2013

Taper goes in Vapor. Is Fed's credibility at stake?

"Fed delays Taper, monthly bond buying is intact at USD 85bn per month."

Federal Open Market Committee's much awaited bond Tapering program failed even before its start. For the past couple of weeks rumors about Fed's tapering between $5bn to $15bn were all over the market and market had well en-cashed those rumors. 

Finally the day came and to everyone's surprise it delayed monthly bond tapering program. Before the meeting someone said that Bernanke might simultaneously announce that he's winding down QE and winding down his career as Fed Chairman. In fact he has done neither. 

Fed's Press Release :

Why No Tapering:

In post meeting press conference Mr. Bernanke answered that unemployment was lower but not low enough (benchmark of 6.5% has set by Fed. Also he warned of the potential "very serious consequences for financial markets and the economy if the country defaults on debt or if the federal government has to shut down due to a congress failure to reach a budget deal."

Post announcement effect :

As we said in our last post No matter what Bernanke says, Markets are going to get crazy, and so it did.

Gold prices rallied immediately after the FOMC announced that it would leave its monthly bond purchases unchanged at $85 billion a month, in a decision that surprised the market.
Other metals also surged.
December gold futures were up $55.40 an ounce at $1,364.80 on the Comex division of the New York Mercantile Exchange. December silver was up $1.331 at $23.115. Nymex October platinum rose $40.70 to $1,463.10, while December palladium gained $10.70 to $717.65.
Five minutes ahead of the Fed announcement, December gold futures were trading at $1,313.50, December silver was at $21.695. October platinum was at $1,433, while December palladium was at $704.65 and December copper was at $3.2835 a pound.
Market participants widely expected that the Fed would announced a cut to its bond-buying program, known as quantitative easing, ever since Chairman Ben Bernanke said in May that the Fed was preparing to taper its asset purchases as economic conditions warranted. So when the Fed said it put off tapering until later in the year, it came as a surprise.
Hence Gold prices rallied sharply, so did the stock markets.
The S&P 500 jumped to hit a new high of 1729.44. The Nasdaq rallied to hit its best level in 13 years. The Dow Jones Industrial Average spiked nearly 150 points, setting a fresh intraday high of 15,709.58.
US Dollar Index fell nearly 1.28% to make a new low in past seven months.
Fed Lowers Jobless Rate Threshold; Lowers Economic Growth Outlook

The Fed said it will keep buying bonds as long as the unemployment rate remains above 6.5% and inflation between one and two years ahead is projected to be no more than a half percentage point above the Fed’s 2% longer-term goal. In August, the Department of Labor said the U.S. unemployment rate is 7.3% and inflation has run well below 2%. Previously, the Fed had signaled a 7% jobless rate for a sign to start the end of stimulus.
The Fed may not taper until the unemployment rate is “well below” 6.5%, Bernanke said, and suggested rates may remain low, even if the jobless is rate is down if inflation is also subdued.
The Fed cut its U.S. growth forecast for the third time this year, saying the economy will grow between 2% and 2.3% in 2013, down from 2.3% to 2.8%. It predicted an inflation rate no higher than 1.2% in 2013. The bank is unlikely to raise the short-term fed funds interest rates until 2015.

No matter what Ben Bernanke says, markets are going to get crazy

Today’s Federal Reserve decision is momentous for a number of reasons.

Foremost among them: the Fed’s monetary policy-making body, the FOMC, is expected to announce the first reduction in the monthly bond purchases under the open-ended quantitative easing (QE-III) program and later condemned it in totality which was introduced exactly a year ago.
In a broader sense, this first “tapering” of QE represents the beginning of a shift away from the easy-money policies that have dominated the monetary policy landscape over the last five years coming out of the financial crisis and recession. 
There is, however, a debate over the amount to taper. Most of the experts are betting on $10 billion, bringing total monthly purchases down to $75 billion. Markets have already en-cashed the amount of sentiment it could have created. 

Monday, September 16, 2013

Silver Outlook 17 Sep, 2013

Please quit your positions taken at $21.40 and $21.86.
Daily signals are weak.Silver may go as low as $20.18 or even $19.72 in this week.
I am not sure, so we'll wait for weekly closing for taking new position.
Or you may go long at $19.72.

Sunday, September 15, 2013

Successful Gold and Silver Trading calls

SILVER : $12.78 or $145.21, Next week will decide


Moving averages play an important role in understanding the market movements and thus help to recognize the trend. There are two types of pattern:- 
Pattern 1 : Single Process
Pattern 2 : Double Process

Single Process:
When 100MA is above 20MA this process applies.
At first you have to add simple Moving Averages of 4, 10, 20, 50 and 100 in weekly candle chart. After forming bottom Silver crosses 4MA, 10MA & 20 MA and retrace back to 10 MA. After taking support of 10 MA it jumps to 50 MA and then touches 100 MA and from here retrace back to 20 MA support. After another uptrend it comes back to 50MA support level and then takes a slight upside move and comes back to 100MA support level.
Now these support levels go reverse. Again at 100 MA then 50 MA. Consolidation phase mostly ends here. After a long jump silver retraces to 20 MA support. Grand pre-rally begins here.
Once it takes 20 MA support, silver never closes below 4 MA support. After a pole jump a plus mark or a red candle is expected with new highs. This high is about either 25% or 40% up from 20 MA support.  From this high point it retraces exact  8.5% till next week with a bounce-back candle.  6th or 7th candle from this bounce-back candle  makes a new  top (10% or more upside from week lows  for two consecutive weeks or with one week gap). Book profits at second 10% weekly hike (from that week’s low) and now its time to go short.

Double Process:
When 100MA is below the low, this process applies.
As the name suggest this process complete in two legs. First ‘leg’ completes properly as single process does but it doen’t take support twice on 100MA and there is no consolidate  on 100MA so  it takes support  on  100MA again to re complete rest of  the process with new highs.

Single Process :- 1

Double Process: Leg-1

Double Process: Leg-2

Single Process:2

Incomplete (Failed) Rallies :

Incomplete Rally (Single Process) 1:

Silver crossed 20MA and came back to take support of 10MA. It went sharply to cross 50MA next week and tried to cross 100MA but could not succeed.

Incomplete Rally (Double Process):

This rally crossed 10MA and 20MA and came back on support of 10MA. Then it went higher for coming back to take support on 20MA but couldn’t hold the support and went down direct on 100MA support. It again rose to touch 50MA and came back to take support on 100MA but closed below 100MA. Anyhow, it managed to recover and next week closed above 100MA. Again they tried to closed above 50MA but couln’t quite do so and fell back to 100MA support to restart. This time couldn’t hold 100MA support again and finally rally failed.

Incomplete Process (Single Process) :2

This rally had begun properly with 8 weeks consolidation. After crossing 20MA it had to come back for 10MA support but it crossed 50MA and then 100MA. This was a blind rally. It came back to take support on 50MA and 20MA and tried again but couldn’t hold up 100MA and fell sharply below 50MA to fuzz this rally.

Running Rally:

This current rally started on June 28th, 2013. It crossed 20MA and came back to take support on 10MA last week.
If  Silver holds this support for next two weeks on closing basis, bull trend will be confirmed. If, however, this 10MA support breaks for two consecutive weeks on closing basis another drop to $12.78 is possible.

Where the prices will go if Bull run is confirmed ?

The very first rally of this series (Single Process 1) almost doubled the prices i.e. from $4.00 to $8.47.

Second rally (Double Process) quadrupled the prices i.e. from $5.43 to $21.34.

Third rally (Single Process 2) sextuplet the prices i.e. from $8.41 to $49.82.

So, will the fourth rally (If this holdup) octuple the prices i.e. from &18.20 to $145.00?