Dangerous Point For Silver

I wanted to send this update to the entire membership because I think it to be important.  While I am still of the belief that we are in a bottoming phase in the metals, the turn down in silver this morning has presented us with a dangerous situation.  As long as it still holds this downtrend channel, there is still potential for this to be bottoming in a wave 2.

HOWEVER, that is not to be trusted until silver is able to get back over last week's low, and through 14.70 strongly.  If we see that happen, then we have confirmation that this ending diagonal completed with a spike down and reversal which is normally seen when they complete.  

But, as long as we remain below last week's low, caution must be exercised in the near term, as it has opened the door to the drop towards the mid 13 region.

So, as I started this update, if you are playing these smaller degree, you MUST remain on your toes right here and now.  The structure to the downside has been terribly overlapping and divergent, which means you should be on high alert for a reversal.  But, the market must prove itself to believe the reversal is real - otherwise, it can continually leak lower to the mid 13 region for a larger degree wave ii bottom.

silver144min
silver144min
Avi Gilburt is founder of ElliottWaveTrader.net.