Tuesday, September 9, 2014

Come on, Are you serious?


I know, I know. Silver again? Give me a break.

Silver is oversold in the hourly charts, 4H and daily. It is getting pretty oversold on the weekly.

Silver is now trying to breakdown through a pretty strong support between 18.70 and 19 which I mentioned last week.

Interestingly, Gold has touched my initial downside target of 1250 to bounce off. The next $10 down until 1240 will offer a pretty strong support for Gold.

Given that both Gold and Silver spiked downwards areas of support, I have decided to load up some extra exposure in the metals.

I am actually thinking of getting physical delivery on my next metals purchase, but I am waiting for my salary to come in, heh heh.

On a sidenote, I feel that the USD has gone up too fast and too far. I am expecting quite a large pullback actually. If the USD heads down (where it fundamentally will be heading in the long run), precious metals would benefit quite nicely. Oh well, doesn't matter, I have strong holding power!

2 comments:

  1. What is your planned holding period? Are you day trading or swing trading? It sounds like you’re betting on a downward trend reversal that hasn’t occurred. Safer to wait for an uptrend to develop instead of bottom fishing. Traders trade the charts, not what they think will happen. My opinion, your wallet.

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    Replies
    1. Hi ArizonaTrader,

      Wow, pretty cool to have someone from Arizona commenting here! How did you find me?

      As part of my long term portfolio, I think precious metals as an asset class can help me with diversification. I think that I would always have a fraction of my wealth stored in precious metals throughout the rest of my life, though exposure amount would vary based on their relative value, of course.

      My planned holding pretty is pretty long and I don't think there will be an opportunity for me to sell until at least 1 or 2 years down the road. If I held onto to my current holdings for the next 5-10 years it would not affect me much either. My "expense ratio" is the storage cost that the vault charges me, which would be less than 0.6% per annum. And it's a vault, so I could always request for physical delivery. That is a nice psychological boost that I will have some silver pieces to throw at zombies during an apocalypse, haha.

      My exposure to precious metals is not over 10% yet, but I also struggle with myself to view it as just another asset class that has been beaten down and looks to offer value in the long term.

      I plan to aggressively increase my position once I spot an uptrend forming. Averaging down my position helps me psychologically manage the % unrealized loss though. Since I'm not on margin and with minimal holding costs, I can do this. It would be quite a terrible and ineffective strategy for traders like yourself I would imagine, since it would be better to cut losses and wait for the better entry, haha.

      What are your opinions of Silver and perhaps Gold as well? If Silver reaches $15, I'm backing up the truck and building a house out of Silver!

      MH

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