I continue to perseverance over the enthusiasm I see currently with silver and the optimism that I saw when bitcoin was in its descending triangle. I had a whole lot less trades under my belt, and I had way less tools in the belt as well. This monstrosity of a trading system actually is a blend of a lot of different systems that I have smashed together to help give me a super big picture. Silver is on the 1M chart, Bitcoin on the Day. Deeper in the post will be the 3w silver chart vs the 1d chart bitcoin chart and that is a very intriguing chart.
The yellow circles show where the price action of both silver and bitcoin broke free of both the 100SMA and the Double Ichimoku clouds at the same time. The yellow squares shows how the break outs were confirmed with the OBV EMAS taking a bullish ordering. A study of the uptrend shows so long as the OBV situation is bullish the clouds and the SMA hold as support.
The red circle shows the kumo twists on both assets, formally signalling to cloud traders we are in a bear market, As the cloud narrows and twists the 100SMA turns from support to resistance and that is another bear market signal. We clearly see after the fact that Bitcoin went into a descending triangle. Silver is still developing its structure but I remember all of the potential bullish charts that were posted that could apply to silver. "Bitcoin will form another saucer continuation pattern like it did in the last bear market". "Bitcoin will just be in wyckoff accumulation". This piece of news, that piece of news all point to more adoption. Same thing with silver. Green tech uses silver, silver is natural money, silver this and silver that.
But the fact is, the chart still looks like hell. The red square on the OBV shows how severe the volume situation is. You can use divergences on the OBV itself to help look continuation (Hidden divergences) or reversals (classic divergences) and you can do that with the peaks in the OBV EMAs. But you can also just use the OBV EMAS as simple support and resistance for the OBV. And right now we don't have any chart structure or divergences in the silver chart that suggest we are going to have a bullish ordering of the EMAS any time soon.
The black rectangle shows the OBV action is currently compressing between the 10 and 20 EMAs and that constriction does predict a breakout. The blue arrows show a double bottom on price but divergence in the OBV. We have a falling wedge on a flag pole. But also, falling wedges and flag poles are some of the poorest performing chart formations out there. One wedge target is merely the hight of the wedge, and we would be looking for a double top in this descending triangle.
Below we have silver on the 3W chart and it looks to be amazingly powerful. The single green arrow on silver shows where whe mounted the 100SMA and the three green arrows on Bitcoin show where the price action mounted the 100SMA just to fail and retest support. This closer shot of the price actions also show why I use the double cloud. The single cloud on both silver and bitcoin suggest we are about to find support on the classic cloud but we look like we will fail time and time again. You have the best shot of getting through support when both have created a nice flat top and the OBV EMA situation looks good. Silver is no where near that right now. The 100 OBV EMA should continue to act as resistance and when the OBV action gets above it the bias would be to short. The silver descending triangle may need to be adjusted as we might set a slightly higher high than what we set, but a few mere percentage points at max. We may not get as many rejections at support on Silver that we saw on bitcoin. If silver does get kicked in the tenders then I would have a lot of confidence that silver is in a ABC correction and the B Wave would be terminating around $35.
Something drastic would need to happen with the OBV and ichimoku cloud situation for the price action to leap off the 100w SMA at this point. The 1w silver chart below has hidden bearish divergence peak to peak on the RSI against the triangle resistance with suggest a continuation of lower highs. If we get classic hidden divergence within the current top that predicts a reversal of the current top. Both of those divergences at resistance would tear this uptrend apart and price action goes back to support
The everything bubble includes silver. The linked post has some target setting.
My target for silver is $21 this year 2020 and $27 by 2021. Look for it to run at the beginning of this year. Silver and Gold do well the first months of a Presidential election year. That would firmly break silver out of the triangle pattern.
This_Guhy
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@awh2830, Normally I would agree. But we really need to see the volume situation change, and the cloud still looks mega bearish. If we break the triangle then obviously that assumption is negated and we can go higher. I have a profitable entry. I can take profit at resistance and if we break it look for another entry. but if enough people take profit at the triangle resistance then the formation asserts itself and we go down.
The next few months are unironically critical for determining the future of silver.
awh2830
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@This_Guhy, Cyclically they are some of the best months of the year for Silver. Silvers best month is February and January is also good.
FerroIgnique
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you have any targets or are you thinking out loud? I call silver to at least double-top, bitcoin sub 4.5k
This_Guhy
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@FerroIgnique, Silver dies in triangle and the linked post goes into target setting. Thank you for your comment!
FerroIgnique
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@This_Guhy, I say nay. Silver will be dragged upwards by gold. Central banks will by gold and non-institutional investors, not knowing about Basel 3 will diversify into gold silver and palladium, causing a precious metal rally that will have a blow-off top as people FOMO in.
This_Guhy
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@FerroIgnique, Well, if gold falls out of this pattern here is the target