SILVER UPDATE

This post is from Chaz...a commodities trader that writes a monthly newsletter on the precious metals market. He has given me permission to post it on my blog. As a disclaimer...I (and Option Magic) are not responsible for the content or recommendations in this newsletter. Also...a lot of this information relates to trading the actual commodities. There may be some terms or strategies that you don't recognize. This update is meant to be an information guide for those of you that are trading gold and silver...or just the gold and silver ETF's like the GLD or the SLV. This commentary is opinion and analysis. You must still use good money management and trade management principles. You must also read the charts. No one...I'll repeat...no one knows the exact future of any event on Wall Street. You must still do your due diligence. Thank you Chaz.


Hello traders. It seems we may have had an upset in the silver market. I was expecting the low to occur on this coming Thursday but I suspect the low may have been put in on Monday. This is most likely due to all the bad news coming out about our faltering economy. I'm looking at the Hong Kong market tonight and I don't see any signs of weakness. This bothers me. At this point , I am beginning to get concerned about our July puts. I was expecting the July contract to drop to about $32.15 or lower. Time value is withering. If I do not see major weakness in the next 36 hours, I intend to exit my July 36 puts for whatever I can get for them. Its possible this market could drop to as low as $29 by next week, making this a very profitable trade. But I'm a trader, not a gambler. I paid a strong premium for these puts and I don't want it to completely erode away. I would expect the shorts to hammer this market hard but they don't seem to be trying very hard. I have to ask myself "Why ?". I don't have an answer. I DO NOT TRUST THIS MARKET AT THIS TIME. Instinct and experience tell me the shorts SHOULD crash this market to $32 or below. It may be wise to exit half of your trade by noon Thursday and ride out the rest to see if it pans out. We are at a really tough crossroads right now. I will try to make commentary again tomorrow night if possible. I am keenly aware that I should have been a little more attentive to your questions the last few weeks and I ask that you please forgive my absence . My attention has been drawn to other concerns that required my immediate attention. I offer my sincerest apologies. With the kindest of regards.....happy trades........Chaz. 6/14/2011...11:57 pm