AG shows it most clearly — very oversold move right into the loving hands of support and 100SMA. Two day bounce into first big target of the 50SMA. This is where many active traders start peeling off positions. Now you enter, at least for us, a more difficult part of the trade. The only way we’d enter now is if stock consolidated and set-up new long.
Similar action in EXK. Bounce on support from very oversold levels into first major resistance. Easy part is over, now comes the grind.
The miners were more “clean” in holding support and bouncing. The silver futures were much more wild: overshoot of 34, and then rally back through 34 and to 38, again first major resistance. That was the clear bounce and probably where a lot of traders took profits. Now comes the hard part for silver longs, building new bases and new set-ups at these higher levels.
As we wrote yesterday for us the “edge” is gone because the big levels have been hit — if we get involved again it’s for scalps here and there, but nothing that we will obsess over during the nights. Think of it as a major car accident. The persons involved are rushed to the hospital, the most serious injuries are taken care of and the patients are stablized. But the next step is the hardest, the long, slow road back to recovery.
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