The downside target at 21.16 that we’ve been using for a while remains not only viable but likely to be achieved, given the downtrend’s decisive penetration of p=23.05 ten days ago. The move has been taking its sweet old time, however, chewing up shorts last week with a ratcheting hump that produced little net change. As in gold, a strong rally to the green line, however unlikely, would trip a signal to get ‘mechanically’ short. The trade would not be for the faint-hearted, though, since the theoretical risk on four contracts would be around $19,000. Obviously, this one is not for beginners; nor would it even be an exceptional opportunity. We’ll consider it on its merits nonetheless if and when it gets there, assuming the December contract doesn’t fall straightaway to D. _______ UPDATE (Sep 28, 5:30 p.m.): December Silver has been tap dancingon the 22.11 ‘secondary’ pivot for nearly two weeks, substituting dread for tedium for investors who have watch the futures fall 15% since early August. The initial plunge through p=23.05 strongly implies that it’s only a matter of time before D=21.16 is reached. ______ UPDATE (Sep 30, 7:03 p.m.): Silver has taken a leap from a low just above our 21.16 target. It is bullish that the futures didn’t quite get down there, but in any event, I’d suggest taking this rally seriously, since it is coming at a time when stocks are finally starting to look like hell. It was always going to take a major paradigm shift in the economy to light a fire under bullion, but perhaps this rally is announcing that the wrenching shift lies just ahead.
SIZ21 – December Silver (Last:22.14)