Long SLV at $25.62 (by Ryan Mallory)

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Silver is no doubt a fairly speculative trade, but because I’m trading it with a tight stop-loss that makes sense (i.e. below a critical support level) I’m willing to take a stab at this trade with a stop-loss at $25.40. 

Commodities have, no doubt, been weak of late, and the triple bottom that is trying to form is what creates the basis of my trade. If it doesn’t work out, I lose roughly 1% of my trade value, while on the other hand if the trade succeeds, I envision it playing out to the tune of 5-10%. With that kind of risk/reward one can be right far below 50% and still make a decent living trading the market. 

After posting this trade, Springheel Jack (@SHJackCharts on Twitter) noted though that Silver has a confirmed rising support trend-line from 2008 low Friday by bouncing there. But today it is dropping below it. Different perspectives on trades are useful and reinforces the belief today, that I shouldn’t give this trade to large of a leash if it doesn’t play out according to my original thesis. 

Here’s the SLV Trade Setup.

Silver SLV

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