Let’s give credit where credit is due. Silver has mounted an impressive run! Yet despite any central bank’s plan of future purchases, which we cannot know, there is the Investor’s Quandary…
I do like this girl — Silver;
But… to fall in love with her?
Commodities futures traders know. And hopefully investors know: “It’s okay to like a metal or a commodity, like Silver. NEVER, however, fall in love with one.
Peter Lynch
The advice "Never fall in love with a trade" is a common Wall Street adage and is not attributed to a single individual. However, the legendary investor Peter Lynch famously made a similar point. He cautioned:
Never develop an emotional attachment to any stock you own.
Disagreements
For months, Silver has run. At times, almost straight up. A brand of equity Whooph has learned to be wary of.
And now for good reason…
Whooph, who has studied Disagreement between PRICE and its corresponding INDICATOR, since 1999. Specifically, comparing highs to highs of an uptrend and lows to lows of a pull-back, correction, or bear. Often on different timeframes and in various renditions of similar technical weakness.
Because he swing trades, he has analyzed over 45,000 charts for these disagreements, which he says almost always occur in a particular Elliott Wave.
Whooph averages 121% annually.
Yes, she’s been able to consolidate and shake off this weakness, but the blemish still laying there in the chart, now repeats or presents in different forms.
Her strongest moves according to the MACD histogram (below) are on the SELL-side, while her BUY-side MACD signals are progressively weak to non-existent!
Summary
Commodities often have long legs. Both in the up and down legs. Therefore, for these long legs, it is generally ill-advised to Buy and Hold a commodity which has truly reversed. On this one Whooph is keeping at least one eye open!
