I remember Jackie Gleason. He was an absolute hoot! When I looked at the metals prices, and then at my trading account. The first thought that came to me was… How sweet it is! Yeh, support held… BUT, we want to know how much conviction was behind it. The more volume there was, the more traders believe in the price support level that just held. Was it a truly big deal and the market is turning here, or… was it just a tepid effort, a hope and a prayer, that this might hold here and turn. That’s what the charts ought to tell us.
First up, are those that rose, and they all did, but these on merely average volume: CDE, AG and GDX.
We’ve got some that rose on light volume, like: ASM, RGLD, HL, SLW, MUX, FSM, PVG, SSRI, RIC, PAAS, SGDM, AUY, ABX, SLV and GLD.
Then, we do have one that showed conviction with big volume: IAG.
This is incredibly simple to interpret. Conviction was not present, but the idea on the part of some to take a risk was. Now, what we need to see, is either more courage and conviction, resulting in a considerable increase in volume, or… the lack of conviction and volume will cause others to rethink their positions, and consider selling. The average volume for all 19 symbols I track was off by 1/5th, a full 21%… that is not encouraging!
This market is going out on a limb now. We’re in it, and we get to watch it, but there’s analysis going on, the consensus, when it kicks in, will drive it further up, or will say that this isn’t going to work at this level of support and get out, taking it through, and down to the next level of support. Overnight tonite, and Wednesday here, should give us more insight. Check in to find out.
A check in at stockcharts.com would suggest that those oversold technical indicators that were saying that risk among these issues might be about wrung out, also reversed today, as I looked in on them, and would be interpreted by others trading these stocks, as likely buy signals. Let’s see tomorrow if that encourages more buying, and results in a real reversal to the upside.
A check in with a recognized expert technical analyst says that their timing efforts have just given a green light to the metals and miners, but also cautioned by recommending very tight stops under the most recent lows, which corresponds with what I stated… conviction is low, but risk-takers are getting in, hoping this is the turn. But, if it is not, they’ll be getting out quickly! We have been adequately apprised and warned.
Wednesday morning, as of 7:11 am EST… on the Kitco site, where I check on prices, gold and silver are hanging right in there at the very levels we were looking at Tuesday evening. They found support, and that support has held, so far. If it should continue to do so, risk will be coming out, and the base for the next lift-off would be being put in place… let us watch and wait.
9:20 am EST, and something’s up! Metals have advanced some, especially silver, and mining share prices should open very well. If it should hold, support was absolutely found, and a possible new launch might commence. Let’s see!
Here’s to your accumulation of real wealth!
Harold F Crowell