I am moving this talk of Gold, Silver and Indexes Using Price Action to this new journal. It's to keep the focus and not hijack other threads.
SLV is shown here. I have on purpose removed some supply lines to focus a bit more on what price actually is doing instead of getting lost in the lines. Lines are awesome for trade management and even before but one can't overly rely on the lines to make all the decisions. At the beginning of this thread it is shown that one can use the lines to survive, and I totally agree with that statement. Lines have corrected my direction more often than not, and I use them quite extensively. What I don't do is become a prisoner of these lines. Perhaps those who are newer might need the lines to keep them focused, but after a while even though the lines are on the chart, it's the price action itself that's the real deal, and the lines are like the very talented and useful backup singers.
So the tight closes are the focus today. Why is price closing so tightly? Isn't it a bit unusual that something like this would happen? For some reason I keep remembering the Reminiscences of the Stock Operator by Livermore. He mentions a few times when a group or syndicate would gather and support a level and won't allow the price go too much beyond a close band. Whenever price is dropping they buy and when supply is exhausted and as a natural consequence price starts to rise the syndicate would post offers to ensure price doesn't just shoot up. This goes on until the required line is accumulated.
Now, here I must be clear that we don't really know whether it's accumulation or distribution that's going on. We don't even know if anything at all is going on for that matter. But, the tight closes are somewhat intriguing, isn't it? What can we do about it? Can we profit from it? Perhaps yes. Usually, if it is an accumulation or distribution and when the required lines is accumulated or dumped, an energy is released and price is allowed to go unimpeded. We could stay alert to that happening, even though there's no certainty that will happen. All we can do is act on the behaviour we see. Price is moving in a very tight range and sooner or later it's going to exit that range. Either it will be a clean move or a fake and price could go the other way. We don't know what's going to transpire, but we do know that we'll be there ready to pounce on the opportunity when that happens, and to capitalize on it by hopping on the elephant when it starts to run.
SLV Weekly:
SLV Daily:
Another interesting thing to note is the price drop from around 24 to 21 is about 50% of the price run from 18 to 24. Price hangs in a balance.
Gringo
Edit: This post lead to further inquiries as to whether we can tell it's an accumulation or a distribution. The question raised by Db was the number of shares outstanding. I haven't been able to figure out how that's going to help in determining whether there's an accumulation or a distribution but the answer is: Shares Outstanding: 354,450,000 as of Aug 3, 2013.
Edit 1: Anyone interested in the SLV can go through my previous posts to see how this commentary evolved. The whole SLV commentary started in late August and for whatever reason I have been quite consistently posting my analysis throughout.
SLV is shown here. I have on purpose removed some supply lines to focus a bit more on what price actually is doing instead of getting lost in the lines. Lines are awesome for trade management and even before but one can't overly rely on the lines to make all the decisions. At the beginning of this thread it is shown that one can use the lines to survive, and I totally agree with that statement. Lines have corrected my direction more often than not, and I use them quite extensively. What I don't do is become a prisoner of these lines. Perhaps those who are newer might need the lines to keep them focused, but after a while even though the lines are on the chart, it's the price action itself that's the real deal, and the lines are like the very talented and useful backup singers.
So the tight closes are the focus today. Why is price closing so tightly? Isn't it a bit unusual that something like this would happen? For some reason I keep remembering the Reminiscences of the Stock Operator by Livermore. He mentions a few times when a group or syndicate would gather and support a level and won't allow the price go too much beyond a close band. Whenever price is dropping they buy and when supply is exhausted and as a natural consequence price starts to rise the syndicate would post offers to ensure price doesn't just shoot up. This goes on until the required line is accumulated.
Now, here I must be clear that we don't really know whether it's accumulation or distribution that's going on. We don't even know if anything at all is going on for that matter. But, the tight closes are somewhat intriguing, isn't it? What can we do about it? Can we profit from it? Perhaps yes. Usually, if it is an accumulation or distribution and when the required lines is accumulated or dumped, an energy is released and price is allowed to go unimpeded. We could stay alert to that happening, even though there's no certainty that will happen. All we can do is act on the behaviour we see. Price is moving in a very tight range and sooner or later it's going to exit that range. Either it will be a clean move or a fake and price could go the other way. We don't know what's going to transpire, but we do know that we'll be there ready to pounce on the opportunity when that happens, and to capitalize on it by hopping on the elephant when it starts to run.
SLV Weekly:
SLV Daily:
Another interesting thing to note is the price drop from around 24 to 21 is about 50% of the price run from 18 to 24. Price hangs in a balance.
Gringo
Edit: This post lead to further inquiries as to whether we can tell it's an accumulation or a distribution. The question raised by Db was the number of shares outstanding. I haven't been able to figure out how that's going to help in determining whether there's an accumulation or a distribution but the answer is: Shares Outstanding: 354,450,000 as of Aug 3, 2013.
Edit 1: Anyone interested in the SLV can go through my previous posts to see how this commentary evolved. The whole SLV commentary started in late August and for whatever reason I have been quite consistently posting my analysis throughout.
