Silver prices: Sell, Hold or Buy?
Tuesday, May 3, 2011 at 05:06AM
Silver Prices in Silver
silver chart 03 May 2011.JPG

One Black swan event and a change to the margin requirements for the purchase of silver futures contracts conspired to reverse silver prices.

Silver on the Comex division of the New York Mercantile Exchange dropped considerably on Monday as investors were forced to stump up more cash or sell some of their holdings following the CME Group raising its margin requirements. Rule changes are a form of market intervention and should be part of an investors criteria during the decision making process alongside political risk etc.

However, if you have physical silver in your very own hands then you will not be subjected to such pressures. Sure the price of your silver drops in value when such actions are inflicted upon us, however, the silver tide is rising and the effect of this particular action will be short lived. On this occasion margin requirements were raised 13% by the CME Group, who are the owners of the Comex. The volatility indicator is moving towards 'severe' so we must now expect silver prices to move in order of four to five dollars, in either direction on any given day. The silver space is not a playground for those of a nervous disposition. So once having acquired your core holdings be prepared to sit through whatever this rocky road throws up and remember that nothing goes up in a straight line and the bears will have the odd moment in the sun.

Our strategy remains the same , physical metal in your hands is number one, followed by a selection of quality producers and finally, a few well thought out options trades. Ignore the bubble calls, that’s nonsense and stick with the script.

Taking a quick look at the chart we can see that this pull back has taken the steam of the RSI, however, the MACD and the STO remain in the overbought zone. Should silver prices fall further treat it as the buying opportunity that you have been waiting for.


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Today we are pleased to report that www.skoptionstrading.com has closed another two trades with profits of 108.52% and 116.67% respectively.

Over in the Options pit, our model portfolio has achieved an average return of 42.10% per trade, 76 closed trades, 74 closed at a profit, or a 97.36% success rate. Average trade open for 45.30 days.


sk chart 03 May 2011.JPG


The above progress chart shows our performance when profits are re-invested, however, to see exactly how it is going, please click this link.

So, the question is: Are you going to make the decision to join us today.

Stay on your toes and have a good one.

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