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Michael Noonan Edge Trader Plus Michael Noonan is the driving force behind Edge Trader Plus. He has been in the futures business for 30 years, functioning primarily in an individual capacity. He was the research analyst for the largest investment banker in the South, at one time, and he... More
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  • S & P vs Silver - One Shows An Ability To Rally. There Is No Ending Action In Silver. 0 comments
    Jun 27, 2011 11:38 PM

    Monday Evening  27 June 2011

     Yesterday, we posted an article on the S & P and one on silver,
    positing that both may be buying opportunities.   [See S & P -
    Continuation Down, Or Buying Opportunity?
    , click on
    http://bit.ly/lFigNL and Silver - Buying Opportunity?, click on
    http://bit.ly/mdfmoc].  On Monday, the S & P was able to mount
    a rally at an area of support.  Meanwhile, silver was down over
    one dollar.  The difference in these two commodities is an
    important one of which to be aware.

     What you see on the daily is possible ending action in the form
    of a higher swing low attended by increased volume, some of which
    we identified as buying, Thursday's activity, third bar from the end.
    Notice how today's low held the high volume low from then, and
    price was able to rally.  The question remains to what extent, but
    that is not the point of comparison here.

     S&P D 27 Jun 11

     In silver, we see no ending action.  While we identified it at a support
    area, there has been no evidence of an ability to rally, and price instead continued its decline.  Another important point to make was the need
    for  confirmation.  Support may not hold, and there would be no reason
    to buy, based on current market activity.

     We see possibilities for silver finding a low, but the question posed in
    Sunday evening's article was, is it a buying opportunity.  For buying
    and holding physical silver, we said yes, but wait on the futures.  Until
    there is some form of ending action, as seen in the S&P, that advice
    to wait still holds.

     To find demand, silver is likely to go lower.  What will demand look like?  Increased volume on a rally that shows a wide range bar with
    a strong close.

     There is no recommendation in this post, just advice to learn to
    observe the distinction of demand and a lack of it.  The S&P has
    more to prove, but not as much as silver.

    Questions/comments to mn@edgetraderplus.com
    Web site: edgetraderplus.com

    SIN D 27 Jun 11

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