Silver

For Silver to get in bullish gear with Gold, and to confirm bullion's strength, the May contract will need to take out the 32.435 'external' peak recorded last Wednesday on the way down. Otherwise, jeopardy will remain to the 29.975 target of a larger, downtrending pattern begun (on the 60-minute chart) with March 11's 34.410 high (a one-off).

May Silver appears to be consolidating just above the 31.750 midpoint pivot of the pattern shown, implying it is staging for a fresh thrust to 32.190, its 'D' sibling.  The best potential opportunity for getting long via camouflage lies with the tiny 'external' peak at 32.010 recorded Sunday night on the way down.  A B-C pullback from just above it could set up the trade.

DaBoyz were holding index futures in a very tight range Sunday night, trying to determine whether the opening bell is likely to bring a second wave of panic selling.  I've tailored my advice for our long position in the Mini-S&Ps accordingly.  There are also actionable plays in Gold and Silver, the latter with a three-tick initial stop-loss in lieu of camouflage.

I've suggested using the uptrend to get long via camouflage in June Gold, but because Silver's trajectory looks harder to leverage, I'll recommend bottom-fishing two contracts at the 31.665 midpoint support shown. (Note: This could change if 'C' goes higher.)  A three-tick stop-loss would keep theoretical risk close to our allowable limit on entry of $70 per contract, and while this might be cutting it too close, a 'camo' entry here would not be able to do much better. _______ UPDATE (12:33 a.m. EDT):  Sellers ignored the support, stopping out our position for a loss of $75 per contract. The easy move through 'p' telegraphed the weakness that was to follow.

I see downside risk over the near term to as low as 29.940. To come up with this target and a compelling pattern, I took as its point 'B' the first low to breach last January's 31.600 bottom. That is the second most important 'external' low on the chart, after mid-February's 32.715, and that's why I consider 31.090 worthy of anchoring this bearish picture as its point 'B'.  All of this is more easily imbibed visually, so I'll suggest taking in the accompanying chart in a glance.  Most immediately, if further selling awaits, it should be telegraphed via corrective rallies that do not reach their 'd' targets.

The heavy look of two gold vehicles analyzed in today's touts -- HUI and GDX -- strongly suggests that this selloff has further to go. Note as well in today's touts that May Silver could have farther to fall.  Under the circumstances, we'll hold off patting ourselves on the back after nailing some nice lows yesterday in GDX and GDXJ, lest we be distracted from managing risk if these vehicles should fall anew.

A 33.730 rally target identified here yesterday remains valid in theory, but as a practical matter and for the time being, we ought not pay it much mind. Instead, I'll recommend bottom-fishing at the 31.855 downside target of the pattern shown. This Hidden Pivot is nicely located in the middle of nowhere, just as we like 'em,  but camouflage should be used nonetheless to reduce risk.  Using a chart of 5-minute degree or less, camouflageurs should start looking for an uptrending abc reversal to leverage if and when the futures come down to 31.875.  I'll establish a tracking position for your further guidance if 1) the perfect entry opportunity arises; and 2) someone in the chat room reports actually having done the trade.  Click here for information about the upcoming Hidden Pivot webinar and a coupon good for a $50 discount.)

Assuming the selloff in bullion was as gratuitous as the one that occurred yesterday in stocks, we may have a chance to buy at better prices than obtained a few days ago. Accordingly, I've proffered actionable touts for today not only for June Gold and May Silver, but for GDXJ, the Junior Gold Miner ETF that we exited a while back with the intention of repositioning at a better price. The charts accompanying each of these vehicles will give you an idea of how subtle an entry pattern we're looking for in order to keep buying risk as low as possible in a falling market.

Silver's hourly chart looks better than Gold's, with bulls winning each 'duel' by creating cleaner, more decisive impulse legs. That's why my bias for bullion will be bullish on Tuesday. Please note, however, that the futures could stall when May Silver hits the rally target flagged in the tout.