Counter-trend leads to XTL breakout which leads to trend continuation. This cycle is playing out clearly in the chart of Silver (SLV). It made a lower low in price with momentum divergence and bottomed. Now, the XTL Breakout trade has worked well. What is the next possible entry? Trend continuation. Look for either the False bar stochastic trade or the Elliott Type I trade to set up.
Joel Stahl
Joel
I have been looking at this trade and will add some points to the analysis.
On a weekly basis SLV appears to have made a wave 4 top last week with stochastics turning down. The commercials are short both gold and silver, although more short gold (~3x, silver ~2x). Now the daily price may break the regression channel and trigger a long, but I would hold this one close to the vest.
Posted by: Terry Felter | February 28, 2009 at 11:18 AM