(2019-07-20, 04:47 PM)briansmith456 Wrote: How does one play these miners now given most are 50% extended from the 10 sma, wait and hope for pullbacks back near the 10 sma?
In a strong breakout scenario like we've had you might not get a pullback to the 50 day MA for many months in some of these stocks as they have moved so rapidly. But like you saw with gold stocks that did the same thing at the start of the year, you will start to get consolidation at some point soon, which maybe already started on Friday, as there was a lot of profit taking which stopped SLV for example closing above the Stage 2 breakout level.
So if it was me, I would set price alerts at last weeks highs in the strongest looking charts in the sector, and then move on until some of those start to trigger and close above those levels. As if we topped out on Friday short term, then it could be a month or so until it moves higher again. But if it's really strong, it might resume immediately next week again. Either way, you should always plan for what you could lose first, and so need to plan for your risk, and look out for lower risk entry points.
In a follow up re SLV, I am assuming you would be a buyer of 15.21 but you would wait for a weekly close to see that it did indeed break 15.21, correct?
(2019-07-20, 05:42 PM)briansmith456 Wrote: Thanks Isa but most of these really strong looking charts are already 50%+ above the 10 sma on the weekly chart so even if they break above last weeks highs you would still be a buyer despite being so far extended from the 10 sma on the weekly?
For example, AG is about 45% above its 10 sma weekly now so you would still buy it if it cleared last weeks high?
SSRM is about 25% above its 10 sma weekly so I would be more comfortable buying it if it breaks above Friday's high of 16.11. I am trying to find miners like SSRM that are under 30% above their 10 sma weekly that have had good volume.
No, none would interest me at the moment, as they are all way too extended for my risk parameters that I've mentioned on here many times. As I'm always looking for a volatility contraction pattern (VCP) normally. Or when a stock has already broken out in a strong sector (like my entry in KL last Monday), or at least a small consolidation for a few weeks on lighter volume near the highs, but still showing potential for a further move.
For me if Silver is indeed breaking out into Stage 2 (Spot Silver closed at $16.20, which was the previous high in January, so not a confirmed Stage 2A yet, as it couldn't close above the breakout level, although it's clearly very promising), then there will be better, lower risk setups in the months to come, when it's had time to digest this initial short covering rally. As I prefer to trade from a lower risk setup once a Stage 2 is established and the path of least resistance is clear. As the early Stage 2A phase can take many months sometimes, with a lot of churning back and forth. So I would urge some caution, as I can see that you are excited to get in. But try to put your emotions aside, and trade methodically. Like you've heard me say multiple times on here. Always consider the risk first and what you could lose, and make sure to trade proper setups with that in mind.
isatrader
Fate does not always let you fix the tuition fee. She delivers the educational wallop and presents her own bill - Reminiscences of a Stock Operator.
(2019-07-20, 05:42 PM)briansmith456 Wrote: Thanks Isa but most of these really strong looking charts are already 50%+ above the 10 sma on the weekly chart so even if they break above last weeks highs you would still be a buyer despite being so far extended from the 10 sma on the weekly?
For example, AG is about 45% above its 10 sma weekly now so you would still buy it if it cleared last weeks high?
SSRM is about 25% above its 10 sma weekly so I would be more comfortable buying it if it breaks above Friday's high of 16.11. I am trying to find miners like SSRM that are under 30% above their 10 sma weekly that have had good volume.
No, none would interest me at the moment, as they are all way too extended for my risk parameters that I've mentioned on here many times. As I'm always looking for a volatility contraction pattern (VCP) normally. Or when a stock has already broken out in a strong sector (like my entry in KL last Monday), or at least a small consolidation for a few weeks on lighter volume near the highs, but still showing potential for a further move. For me if the Silver is indeed breaking out into Stage 2, then there will be better, lower risk setups in the months to come, when it's had time to digest this initial short covering rally. As I prefer to trade from a lower risk setup once a Stage 2 is established and the path of least resistance is clear. As the early Stage 2A phase can take many months sometimes, with a lot of churning back and forth.
Yes, this was my point. They are all extended too far from their 10 SMA from a risk perspective so wanted to make sure I understood you as it is not just a matter of buying above last week's highs given how extended they all are. I am hoping for a pullback but time will tell.
![[Image: co6ENxzt5G.png]](http://charts.stockfetcher.com/sfchart/co6ENxzt5G.png)