Silver Wheaton Corporation: Purchased a few Call Options Today
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| Topic: Silver Mining Companies — February 11th, 2010
Just a quick note to let you know that in todays trading session in NYC we bought some Call Options on Silver Wheaton Corporation (SLW) and they are the JUNE 2010 series at a strike price of $15.00 and $16.00, for which we paid a price of $2.02 and $1.60 respectively per contract.
We trailed our intended actions yesterday when we said yesterday:
Silver Wheaton Corporation (SLW) has held up pretty well during the recent sell off and we see the 200dma, currently standing at $12.00 as a good support level. The RSI is creeping back the STO is heading north with the MACD looking to form a crossover shortly.
We may be tempted to venture out via an options trade once the topography suits us. We need to see the Euro strengthen and appear in a more attractive light than the Dollar, sending the dollar south and re-igniting the demand for gold and silver.
Gold prices are up today with gold trading at $1096.10/oz as we write and silver is also joining in the fun trading at $15.67. Silver Wheaton has put on 3.96% so far in this session so another good day for one of our favourites.
News of a possible rescue package for Greece by other EU member states has helped to quell fears about the EU for now, aiding the Euro and putting a cap on the US dollar.
This is going to be a volatile ride so hold on tight and be prepared to move quickly and utilize your ’stop’ facilities.
All the best.
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As planed, I added another short on silver yesterday at 15.56, now i had shorts from 18.53, 16.70 and 15.56. but i am not done yet, next week silver is going to break 14.80 and i am going to add another last short at around 14.70 or so.
i will be closing all of them starting from 12.50 to 12.00 but the selloff can reach down to 11.00 , the key here is the dollar reaching 85 points, so happy shorting for 3 to 4 weeks more. after bottom i will wait for a bounce to 14.50s and short again towards 5 or 6 bucks target. this is when you guys are going to feel what real bear market is. check the 1929 chart, and compare the chart of stocks versus commodities, the only difference we have now is, commodities are playing the role of stocks, and stocks of commodities, i mean in term of price patterns, in 1930 commodities didn’t bounce much, but stocks did, now commodities bounced a lot, and stocks much less. history doesn’t repeat but rhymes, this is your rhyme. buy the dollar and drop your golds while you still can
Comment by Di — February 12, 2010 @ 2:32 pm
I’ve been monitoring SLW, GG and ABX for a long time now and looking for a good entry point.
Interesting contra (to commodity bulls) strategy expressed. Not sure you can compare 1929 to present with different roles played by the Fed/Govt, who were caught asleep at the printing press switch back then…also raised taxes, etc., creating the needless suffering post 1929.
Also, I know this could be viewed as a tactical (short term) trade, but you should review the weekly Commitments of Traders (COT) report..in the Feb 2/10 report the commercials (banks) are overwhelmingly short the US$.
Thanks for posting Gold Prices guys.
Comment by Mark — February 12, 2010 @ 5:31 pm
Di,
Are you placing stops on these trades? just a thought as silver can come back with a bit of a vengeance and you might want to lock in some profits.
Comment by Silver Prices — February 12, 2010 @ 7:58 pm
Team,
An except from Jim Sinclair’s latest missive:
The US is headed towards the same economic conditions of the second leg of the Great Depression. A 1933-1934 type unwind is coming. The only argument for a sustainable equity market in the Western World is the Weimar case.
All currencies are headed in one direction: down in storehouse of value character.
Gold is the only storehouse of value. Gold has demonstrated that clearly even in the face of the Crimex and the gold banks fighting it.
Respectfully,
Jim
Comment by Silver Prices — February 12, 2010 @ 9:20 pm
Team,
Just a note to say that SLW managed a tiny gain today even though silver and most silver stocks finished lower, a good show of strength by SLW.
Comment by Silver Prices — February 12, 2010 @ 10:29 pm
of course, i now have the stops at 15.80 and looks to me market could surprise with a bounce to 16.20/30 by thursday/friday, only to reshort more agressively before falling to 12.00. you never know what these guys at the pits will come up with in the middle of the game, but in the end they will come to what they should
Comment by Di — February 15, 2010 @ 2:46 pm