Sunday, December 20, 2015

Silver (SLV): The Inception Wedge ("a wedge within a wedge")

I was quite impressed with Silver's moves on Friday and had previously called silver as a long/buy about a week ago, but I noticed something that gave me warm fuzzies inside when I looked at it's charts, and that's not because I just had a glass (bowl, really) of tequila and eggnog (the economy people, Bourbon is too expensive).

Looking at the near-term our recent gains compared to recent loses shows a lot of upside potential as silver is currently emerging from being quite oversold. The RSI indicator also shows a great 'buy' signal at the moment as a higher lower has just been put in. Concomitant with that my favorite MACD momentum indicator (and our Trix indicator incidentally) has also been showing a steady slow incline which more often than not snaps upwards quickly with prolonged moves like this.
What I think is happening is a smaller bullish descending wedge is being put in, it's just that we haven't yet seen the second lower high to give it it's 'wedge' shape (I'm really basing all of this indicators and a 'feel' the curves are giving me at the moment). However, a larger descending bullish wedge already began to emerge with lower highs put in on May and late-October already. Incidentally, my weekly chart has been showing a bullish declining wedge going back to 2014.