Silver Trading Update

Over the past 5 - 6 months, silver has (on average) performed best early in the week, then come Wednesday, Blythe and her traders at the JP Morgue step in and give price a beat down for a few days.  Considering the huge rally we've witnessed over the past 10 days, I was really expecting silver to get hammered today, so I rolled out of all my call options yesterday at a very nice profit, and decided to sit back and wait for an opportunity to buy the dip.   Well....long story short, we didn't sell off today at all.  In fact, we seem to be consolidating right around $36 as the chart below illustrates.

So now I'm completely out of my speculative positions, and to be honest, I'm feeling like I might've made a mistake.  Anyone who's ever traded will tell you, the only thing that comes close to the pain of having a trade go against you, is the pain that results from being out of the market when a big move comes.

But done is done, and at this point, all I can do is wait and see which way this consolidation pattern resolves itself.  If I had to guess, I would say chances are better that we will see another leg up...mainly based on the state of affairs in the Middle East.  If the idiots in Libya torch another oil field or two, we'll likely see Brent crude over $120/barrel and WTI crude hit $110, which will in turn raise the entire commodity complex, precious metals in particular.   So I'll be watching the news and tracking crude prices...if it starts taking off, I'll likely jump back in with some more silver calls.  If on the other hand Blythe starts hammering silver down through the lower trend line, I will wait and buy the dip, looking for support first at $35, and again at $34.  I may even buy some puts and trade the downside move....really depends on when the sellers go on the attack.  Their latest M.O. has been to go on the offensive during the overnight, thinly traded, GLOBEX session, and if that happens, I'll just wait for the dip and go long.  We shall see....

All for now.