Thursday, June 2, 2011

Silver Chart Request

 I think I posted this last night. The daily chart of silver, PSLV or SLV, both show a large bear pennant.
The technical take on that is a bearish consolidation/continuation pattern. We saw some accumulation inside the pennant and that made some sense as it did breakout, but remember that these obvious patterns are almost always head faked.

On the 15 min chart you can see the accumulation at the white arrow, that was for our breakout, which makes retail traders think the bear pennant is a failed pattern, it sucks them in long and then a failed breakout leaves them in a bulltrap/ That is what I think s going on with PSLV/silver. Look at the 15 min negative divergence.

At this point, I'd either consider a short on silver or at least jumping to the sidelines in the position.

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