Silver

[Strawboss]

While history isnt a perfect predictor of future performance - it sometimes provides some clues.

I think $30 - $33 is going to be a nice buy zone.

7710

[jupitergold]

Sold to close all my July $24 puts since they were just a volitility play. The trade monster holding the $25 puts has more than doubled his money now.

Looking to buy, but waiting to see what shapes up in the low $30's.

[jelly]

I will be looking for us to be oversold on the indicators before i buy. this could be a quick correction before the final spike, or the summer correction everyone was expecting. we won't know until we see.

[Weatherman]

For people following the Bolivia situation, here is an update from PAAS:


Pan American Silver Corp. (TSX: PAA)(NASDAQ: PAAS) ("Pan American" or the "Company") today provided an update on the situation in Bolivia and the San Vicente mine.

On May 1, Bolivian President Evo Morales announced the formation of a multi-disciplinary committee to re-evaluate several pieces of legislation, including the mining law. However, Mr. Morales made no reference to reviewing or terminating agreements with private mining companies. Pan American operates the San Vicente mine in Bolivia under the terms of a joint-venture contract with the state-owned mining company COMIBOL.

Operations at San Vicente have continued to run normally under Pan American's administration and were largely unaffected by the media reports referenced in the Company's April 19 press release, and the Company expects normal operations to continue status quo.

The Company would like to acknowledge and thank its employees and contractors in Bolivia, the San Vicente union, the surrounding community leaders and the local authorities who unilaterally expressed their support for Pan American's continued activities in Bolivia.
http://www.smartmoney.com/news/PR/?story=PR-20110503-003024&cid=951

[DHAWK]

Hey Boss.
Are we ever gonna get a bounce in the silver mining stocks?
Whadaya think?

[Strawboss]

Hey Boss.
Are we ever gonna get a bounce in the silver mining stocks?
Whadaya think?

Yes we will. Believe it or not, the mining stocks WILL leverage the gains in gold/silver again. The farther removed we get from what happened in 2008 - the more the public will forget and come back in. Just not yet.

[Weatherman]

Yes we will. Believe it or not, the mining stocks WILL leverage the gains in gold/silver again.
Although it is too soon to shout the all clear signal, the transition to better stock performance may have already begun. Even though silver took a beating over the previous two days, and PAAS and SLW were also lower in price, the ratios of PAAS and SLW to silver showed significant improvement (charts of the ratios are copied below). When silver stops its waterfall decline, even if it simply holds steady, there is a lot of space for the stocks to move higher to make up for previous weakness. I bought some PAAS at the open this morning because I am hopeful that the good news from Bolivia may not yet be fully factored into the stock price. A quick 30% gain in PAAS would be nice if silver rebounds to my target of $52 soon. :wink:

7729

7730

[Strawboss]

Sold my ZSL.
Bought AGQ.

Expecting a bounce.

[bemac]

Expecting a bounce.

None so far.

[Gcubed]

None so far.

$35.60 or so, perhaps.

[krugger3]

AGQ is a tough buy right now for me. I've made good on the short end of it. If Silver keeps falling into the low 20's high teens it will keep falling. Straw I was skeptical of your Silver call to these levels, but you were right. Thanks for the posts.

[eric2075]

Yeah I sold my really small position in zsl. May have been a little early but I feel better not shorting silver right now. I can't do AGQ now either but did buy a few shares of exk.

[Strawboss]

Dont get me wrong, I am expecting further downside weakness in silver to the low $30's at least. I just think we are going to have a short term rally in silver. It has dropped 20% from its peak in a very short period of time. My plan is to play the bounce and then to re-establish my ZSL shorts. Gotta be nimble in these kinds of markets. There is good opportunities for quick profits if you can play the volatility - but, you have to be prepared for the unexpected as well.

[TiKi]

Closed my SLV puts yesterday. Trying to close my ZSL puts but the spread is crazy wide.


A quick 30% gain in PAAS would be nice if silver rebounds to my target of $52 soon. :wink:



Why be in a PAAS if silver bounces to $52 might as well go in SLV with a bounce to $52 silver you'll get close to a 30% gain.

[Weatherman]

Why be in a PAAS if silver bounces to $52 might as well go in SLV with a bounce to $52 silver you'll get close to a 30% gain.
SLV looks like little more than a paper bag that the banksters are holding open to snare the easy money. One day, that trap will slam shut, and people in SLV will be left holding the empty bag. Stock in a miner is paper too, but at least there is real metal behind it, either in the pipeline or still in the ground. The silver miners have fallen far behind the silver rally, and they rate to play catch up at some future time. PAAS specifically was hurt badly by the prospect of Bolivia taking over mining properties, and it has only partially recovered from that drop. The fact that PAAS was up 2% today while silver dropped another 5% seems like a step in the right direction for that overdue recovery. I hope that PAAS and silver will do much better soon. :wink:

[Strawboss]

I posted the following in last weeks Silver Mining Report but thought it would be of benefit to post here for all to see. It describes my trading philosophy, which I would be the first to admit isn't for everyone.


I received an email from one of my subscribers earlier today stating that they got stopped out on their SLW just before it powered higher today. It is precisely for this reason that I don’t use stops (trailing or otherwise) in PM mining stocks. What many traders don’t know is that the market makers and various players with access to sophisticated data feeds and business intelligence capabilities can literally see your stops. They know where you are, and they can calculate how much money they will have to invest in order to run those stops. Once they have taken out all the stops that their algorithms say to run – they reverse the price with their newly acquired shares (bought at the bottom) and go long – driving the price upwards – leaving you behind minus your shares. This used to be the most frustrating thing to me.
The downside to not having stops is that when you are wrong in your entry points and price moves against you – you MUST have the determination to stay in your position and even increase it as price moves lower (or higher if it is a hedging position). I know – some people would scoff at that type of advice and say that it recklessly risks capital. My response is that the mining sector is the riskiest, most volatile market segment out there and if you are talking about juniors and explorers – riskier still. If you aren’t the type that can handle risk – and the feeling that comes with your capital being at risk – trading in mining shares isn’t for you – and my methodology is most definitely not for you.

I am not interested in minimizing risk – it would be foolish to do so in this market sector. Instead, I am trying to master the art of maximizing potential returns while adopting some risk preservation principles that don’t necessarily impede the overriding objective of maximizing returns. For example, concepts such as investing with the trend, riding out corrections, periodically booking profits, not getting too greedy (where do you draw the line?), diversification, not using margin, etc… these are all beneficial concepts that don’t conflict with the overarching one of maximizing returns.
Using stops, on the other hand is not consistent with my methodology which is why I no longer use them.

[Shortstack]

That goes for both sides of the trade.

Yes, the short side margin requirements would increase but, at around 49 dollars an Oz, they allready had massive amounts of margin in thier accounts.

As silver drops, the margin in the short seller accounts, which was adequate at 49 dollars, starts to be reclassed as "excess" margin. So at 38 per Oz, the shorts have huge amounts of "excess" margin in their accounts, which they could leave in if they were planning on increasing the amount of contracts they want to sell, or use to purchase contracts (thus closing their short positions).

Granted, their excess margin would be less due to the increases on initial and variation margin requirements by the CME, but the rate of increase in their "excess" margin (for every dollar silver drops) greatly outweighs the margin increase due to CME requirements.

In a rising price market, margin increase effects players as follows:

1. New longs need to put up more money
2. Existing longs (who have excess margin) find that their excess margin is lowered, to the extent of the margin increase.
3. New and existing shorts need to put up more money.

In a falling price maret, the margin increase effects players as follows:

1. New longs need to put up more money
2. Existing longs (who are finding that their "excess margin" is rapidly decreasing as the contract price falls) may need to pay more money into their margin account, depending on when they got in
3. New and existing shorts will find that their "excess" margin is increasing every day (hour/minute) and thus can take some of that excess out. Yes, their excess will be reduced by the margin increases, but the margin increases are overshadowed by the market action we are seeing now

[TiKi]

Covered about all my shorts just holding a bit of SLV shorts.
The cheerleaders who where making fun of most of us shorting have finally stfu. "If you hold physical is doesn't matter what the price is" yeh yeh yeh BS. Price is everything.

[Strawboss]

Bought some more AGQ.

What a wild ride! I love it!

[jelly]

strawboss, you have more guts than I do. I can't do the little bumps, just the 'big' ones. I took profits in some of my shorts today, but I'm still holding the majority for the low $30's. I'll buy AGQ when I hear "weeping and knashing of teeth".

[TiKi]

Bought some more AGQ.

What a wild ride! I love it!

I am looking to reenter some shorts at a higher price but I am not going long here. I'm horrible at short term. Maybe we get a 3 day bounce. 5 down 3 up. AGQ/ZSL way too leveraged for my liking.

[Strawboss]

You dont consider going from $50 to sub $36 in less than 1 week to be a big bump? Thats almost a 30% correction in no time flat. There has to be a rally in here somewhere - hence my AGQ. If it continues falling, I will buy more AGQ.


strawboss, you have more guts than I do. I can't do the little bumps, just the 'big' ones. I took profits in some of my shorts today, but I'm still holding the majority for the low $30's. I'll buy AGQ when I hear "weeping and knashing of teeth".

[TiKi]

You dont consider going from $50 to sub $36 in less than 1 week to be a big bump? Thats almost a 30% correction in no time flat. There has to be a rally in here somewhere - hence my AGQ. If it continues falling, I will buy more AGQ.

I think we might see a short covering rally. But the Powers that be have been gearing up for this. With the Goldman/SLV announcement a couple of weeks ago, was their warning. I don't know how low they can take this.

[Dizzy47]

While history isnt a perfect predictor of future performance - it sometimes provides some clues.

I think $30 - $33 is going to be a nice buy zone.

7710

yes indeed, cheap $32 silver, here i come to pick you up :banana:

[Strawboss]

Dizzy,

I dont think we make it there straight from here. I think we rally first and then do some more freefalling - hence my AGQ positions.

But - I could be wrong...

[krugger3]

agq short stock is hard to come by, been trying all morning to borrow from my broker...says none to loan. I think agq has lots of down move left in it.

[Dizzy47]

Dizzy,

I dont think we make it there straight from here. I think we rally first and then do some more freefalling - hence my AGQ positions.

But - I could be wrong...

this is raping time, dont forget, ill take some at $35 too

but i like $32 better :bandit:

doesnt have to be straight, she could be curvy too

PS: they killed zombie osama bin laden again, its their time, no one is watching our corner now

[Strawboss]

This is looking like an excellent prediction.
$35.60 or so, perhaps.

[Strawboss]

It sucks joining a party too early...but, we have to rally at some point, right? Adding more AGQ.

[Gcubed]

This is looking like an excellent prediction.

I dunno Boss. Me thinks I pooched it.