SLV Silver Monthly Buy Signal using Time At Mode

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The monthly chart in SLV             , iShares Silver Trust             is revealing a new buy signal that happened after October's price range expanded to the upside.

Silver             trades well on the Monthly time frame and has seen many profitable signals in the run-up and collapse. I have not always used the monthly time frame for analysis, but it is definitely an interesting time frame to analyze and trade from based on historical results.

The last distribution zone from 2013-2014 was from 17.75-23.84 ($6.09), which lasted for 14 months with 12 months at the mode of 18.7-19.0. Conservative projection from 19.0 down by $6.09 allow for a move to $12.91 which we have not seen yet. The time of the decline, 12 months, expired in September.

What we do to enter a trade using this methodology is to:
1. Buy over the high of the bar where time expired on the downtrend.
2. Buy a range expansion (September's range was $0.98), so when October was up $0.99 you can enter.
3. Buy pullback's to the mid-point of the range expansion from September's close at $13.87 up to $15.60, which is a rally of $1.73 rally, so the midpoint is $13.87 + $0.87 or $14.74 entry. We sit here at $14.49, so you get a better entry level that the "systematic" approach.

The last buy signal didn't fail, but the sell signal after that worked.

The exit strategy is the high from October at $15.60 and risk a drop under September's close at $13.87.


14.49 last SLV             - 11/3/2015 12:50PM EST
Trade closed: stop reached: Great trade setups often take a few times to get right. I know the feeling of "wanting to be right" and I also can see the commodity markets are in a flush-out stage here with Copper pushing new lows. It's a rough time to just "buy and hold" because it looks like "buy and hope". The market drifted under the stop, actually, the very tight stop that I placed on this recommendation. I will stand aside and look for weekly range expansion on the upside to jump on board at higher levels. Historically it is wise to buy dips in silver and sell rallies, but prudence calls for me to say something since SLV went under the stop loss. Re-view every day for the next week for re-entry setups.
Comment: I forgot to re-post on this page, but look at the chart and see if you can see where you would have gotten in using the "weekly range expansion rally" that I mentioned. Look for where the market "ADVANCED" by more than the "PREVIOUS WEEK'S RANGE" and that is your buy signal. The upside target was spot on. Close stops can really hurt trading results, but they limit losses and often limit profits too.

Tim 12/7/2016 1:50AM EST
Comment: Here's the chart with weekly range expansions to re-enter:


The last one is monstrous and it almost hits the target on that bar. Note how none of them were fully retraced until after the target was reached.
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Thank you! Tim. I'm holding a long lot and a new lot setup is sitting there.
timwest PRO Victor.Y.F
Thanks for the reply. It's a "hard" trade to take but I think it makes sense. I don't discuss "how much" of a portfolio to put in this position, but it is worthy of a decent position. Keep me posted.
No worry sir, it's a normal trade. I'm drawing harmonic patterns on this too.
I didn't label out the profits from this trading method - but the first trade was $18.83 LONG entry and with zero loss along the way, an exit at $37.54 for nearly a 100% gain. The second trade was a double-entry SHORT at $29.29 and a 2nd entry at $31 with a cover at $28.50 (for a $3.50 profit in a week) and an ultimate cover at $18.38 for a profit of $10.12. The third trade was the range expansion rally LONG that failed along with a 2nd entry LONG that failed also for a combined $3.50 loss in 3 weeks. The fourth trade was a double-entry SHORT trade at $17.09 and $17.35 that made full profits at $16.13 and the first piece exited at September 30 at $13.87. Depending on how you size your position size.
So - maybe you will say it has been on a hot streak and it is due for a correction (this methodology), but that is the decision we all make - to FOLLOW something that is working or not. If everyone else is making money at doing something (like flipping IPO's, or building spec houses), how long does it take for you to start doing it too?
Update = the decline matched in 40% ranges (instead of using points)
And a 12-month 45% distribution also identically matched ...
Great chart.. Although I'm confused about the initial 12 bar mode count from the high, as it looks to be 13 before the RE lower. Also, is the consensus now to not include RE that still touch the mode as part of the mode?
d1gopher57 timwest
looks like this will fail to confirm upside expansion. Dollar too hot. I tired long myself.
Victor.Y.F PRO d1gopher57
Hi, d1gopher57, please do not use trend strategy, watch out Dollar harmonic patterns.
IvanLabrie PRO Victor.Y.F
Not everyone believes in harmonic patterns.
Victor.Y.F PRO IvanLabrie
Of course, It’s a range strategy. Only use under long term condition but now it’s better than other ways.
d1gopher57 Victor.Y.F
I'm not following this? But I also do not use harmonic patterns.
Victor.Y.F PRO d1gopher57
It's my bad ^^ sorry ... ...
Almost there, with SPX500 nice drop.
I have to say this at this moment: because EURO will drop to 1.03-1.04 area for completing multiple harmonic patterns, XAU and XAG could drop new low for hunting stops to rise. I will hold my XAG long for very long term. So be patient.
Thank you for you update, Tim. Nice evacuation^^. I think this is the moment called extreme speculative sentiment. To be realistic, I reviewed my 3-3-5 flat strcture and if XAU daily close under 1076.19 and XAG daily close under 13.717 then I will close my position.
Actually the set up still works - is at the volume spike now
Thank you Tim! Nice to see this post again!
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