In today’s first alert we wrote that we would prefer to wait for some kind of confirmation that the top in silver is indeed in. It seems that we just saw it in the form of a massive slide in the price of the white metal. Just hours ago, silver was at $17.79 and it managed to decline about $1. It now moved a bit higher (being $17.08 at the moment of writing these words), but the size of the decline after reaching the resistance line (May 2015 high) suggests that the top was just formed. Consequently, we think that it’s now justified from the risk to reward point of view to open a speculative short position in silver.
As always, we will keep you – our subscribers – updated.
To summarize:
Trading capital (our opinion): Short positions (full) in gold, silver and mining stocks are justified from the risk/reward perspective with the following stop-loss orders and initial target price levels:
Gold: initial target price: $973; stop-loss: $1,304, initial target price for the DGLD ETN: $89.05; stop-loss for the DGLD ETN $47.15
Silver: initial target price: $12.13; stop-loss: $18.05, we will provide estimations of price targets and stop-loss levels for the DSLV ETN in tomorrow’s alert
Mining stocks (price levels for the GDX ETF): initial target price: $9.34; stop-loss: $24.07, initial target price for the DUST ETF: $5.72; stop-loss for the DUST ETF $1.74
In case one wants to bet on junior mining stocks' prices (we do not suggest doing so – we think senior mining stocks are more predictable in the case of short-term trades – if one wants to do it anyway, we provide the details), here are the stop-loss details and initial target prices:
GDXJ ETF: initial target price: $14.13; stop-loss: $36.37
JDST ETF: initial target price: $8.86; stop-loss: $2.27
Long-term capital (our opinion): No positions
Insurance capital (our opinion): Full position
Thank you.
Sincerely,
Przemyslaw Radomski, CFA
Founder, Editor-in-chief, Gold & Silver Fund Manager
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