Discussion in 'Commodity Futures' started by StasDesy, May 3, 2006.

  1. StasDesy


    Hi All,

    Any ideas why SLV dropped today ?

    I'm very bullish on silver and ponder adding to my SLV position at this levels.

    I presumed that after SLV is approved it will create a short squeeze among bearish future traders and silver will go higher.

    I also started to accumulate MGN that should also appreciate as silver goes up.
  2. dollar popped. dollar has been selling straight down for many sessions - started to pop today as oil was selling off a bit. lots of speculation in market - so quick sell off

    thats my take. i was impressed how fast it got bid back up though. gold too
  3. Quark


    Why'd silver go down? More sellers than buyers.

    I know, you know that already, but honestly, it's the only reason that matters. If you need a "reason of the day" for a market move, there will always be plenty waiting for you during and after each and every trading session. Some of them may even sound plausible, but in the end, they are totally worthless except to those who need to place blame elsewhere for a trade decision that went sideways. Note that I'm not saying this describes you, OK? But, as time goes by, I think you'll find that news, reasons, "analysis" and all the other blather spewing from a million or so sources is meaningless when it comes to profitable trading.

    Now, all that said, perhaps there was something that just might have been worth considering that could be considered "news". (I like to think of it as a useful piece of the technical analysis puzzle.) At the top in silver a couple weeks ago the bullish consensus was 98%, which is, I believe, the highest bullish reading for any market, EVER. So, you gotta ask yourself, have all the bullish bullets been fired, and are there only sellers left?

    Hmmm. Let's see. A huge one day drop doesn't inspire fear but rather the belief that it's a "healthy" correction and a "buying opportunity". The market rallies back to near the high before the break and the bulls congratulate themselves for "staying the course". If this does not sound like a SELLING opportunity to you, well then, you should certainly stay with your bullish opinion. You've got plenty of company.
  4. sorry - this bullish consensus of 98% - please explain....not familiar with that


  5. Quark


    Did you try a Google on "bullish consensus"?

    When I did the number one listing was for Market Vane, and there were other sites that discuss the topic. Happy reading.
  6. StasDesy


    Thanx, for the info.
    How did you measure bullish sentiment on silver ?
    If your measure is right than 98% bullish consensus is a huge sell and I need to get out of silver quick.
  7. Quark


    The 98% figure was quoted by another source in a newsletter. I don't know what the current figure is, but with the rally after the drop, I'll bet it's still high.

    Silver tends to spike into highs. It's certainly possible there's more left on the upside, but with virtually everyone bullish, it's not for me.

    I think old salt Joe Granville summed it up best years ago. "If it's obvious, it's obviously wrong."

    Hmmm. Everyone thinks its "obvious" silver HAS to go much higher.