UPDATE ON SILVER (11:30 pm EST)
It is now VERY late in silver's long-term 18-year cycle (this is the 18th year). The top of this cycle is obviously overdue, and it looks like it happened with the Jan. 29 "blow-off" price at $121.63. It is also late in several shorter-term cycles in silver, including the current medium-term cycle, which can also claim the Jan. 29 high as its top. So what does this all mean?
The final correction to an 18-year cycle bottom should be deep and steep, and could be as much as 70% - 90%! (70% would be back down to $37.) And because it is so late in the cycle, that drop could happen relatively fast. Nevertheless, it should proceed in stages with some up and down fluctuations in the shorter-term cycles. Right now, a medium-term cycle bottom is due. It may have happened already with the Feb. 6 low of $64.14, but I think the bottom could go lower - at least to $54, and possibly even lower.
My strategy at this point is to wait for the final medium-term cycle bottom for a possible buy spot, but then to watch for the top of the next rally to reverse position and sell short. That medium-term cycle bottom could fall inside next week's strong general reversal zone (Feb. 24 - March 4), somewhere between $40 and $50. Because silver is a very volatile commodity (especially after a blow-off top), we have to be careful in our trading, which is why we want to place trades mostly inside strong reversal zones, as significant tops or bottoms are most likely to happen in those time frames.
I am still on the sidelines of silver.
It is now VERY late in silver's long-term 18-year cycle (this is the 18th year). The top of this cycle is obviously overdue, and it looks like it happened with the Jan. 29 "blow-off" price at $121.63. It is also late in several shorter-term cycles in silver, including the current medium-term cycle, which can also claim the Jan. 29 high as its top. So what does this all mean?
The final correction to an 18-year cycle bottom should be deep and steep, and could be as much as 70% - 90%! (70% would be back down to $37.) And because it is so late in the cycle, that drop could happen relatively fast. Nevertheless, it should proceed in stages with some up and down fluctuations in the shorter-term cycles. Right now, a medium-term cycle bottom is due. It may have happened already with the Feb. 6 low of $64.14, but I think the bottom could go lower - at least to $54, and possibly even lower.
My strategy at this point is to wait for the final medium-term cycle bottom for a possible buy spot, but then to watch for the top of the next rally to reverse position and sell short. That medium-term cycle bottom could fall inside next week's strong general reversal zone (Feb. 24 - March 4), somewhere between $40 and $50. Because silver is a very volatile commodity (especially after a blow-off top), we have to be careful in our trading, which is why we want to place trades mostly inside strong reversal zones, as significant tops or bottoms are most likely to happen in those time frames.
I am still on the sidelines of silver.
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