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Shared a few days ago that SLV had created a flag/pennant pattern, suggesting a huge move should take place in SLV and the key hint on direction was that On-Balance-Volume (OBV) was breaking support. (see post here).
Three weeks ago I shared the chart below, reflecting Swiss Franc had created a pattern, suggesting that Gold/GLD would be put under downside pressure . (see post here)
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At the time of the GLD/Franc post, Gold had just hit the $1,900 level and as suspected, many owners/investors of Gold let me know that NO WAY would the Franc fall or have its impact on Gold/GLD. A day after the year to date high in Gold, I shared that the pattern in Gold looked like a Eiffel tower pattern and that if you see the left side of the tower, often times you see the right side as well! (see Gold Eiffel tower pattern)
I am not into labels or actual reasons why something happens… I just want to help people “enlarge portfolios regardless of market direction” by using the Power of the Pattern as our friend!” So far since the above posting, the Franc has experienced one of its largest single day declines in 30 years and Gold has experienced some weakness as well. Why has it happened? Do we really care about the reason why? I don’t want to be right on reasons, just want to make money!
If the “Power of the Pattern” remains correct, both of these assets have further to fall, since they both just hit long-term resistance levels! GLD and SLV both broke OBV support levels of late, that is why the pattern was suggesting ZSL could do well…so far so good.
Jim…you mentioned GLD fell 30% in 13 sessions back in GE1….looks like Silver will have a 2 day decline of 20%! Looks like ZSL is going to make 40% in 2 days for premium members….can you say yahoo?!?!?!
SLV has been awesome for us this year, in both directions. I suspect that downside in SLV is just getting started. With GLD becoming the largest ETF in America and a “Sector ETF” at that, creates a crowded train that a ton will want to get off of!
Thanks CHRIS!!! I sold yesterday (SLV) – – – broke even. Glad I took your advice based on the power of the pattern! You saved me a boat load! Wondering when to get back in???
Jim…It would be a total guess on my part to say if it will or not. Now when it comes to Silver, that could be very possible, if GE2 unfolds! Thanks for the kind words,
GLD looks to have dropped roughly 30% in GE1 over 13 trading sessions any reason to think that might happen during GE2? I know thats a very specific question but we all seem to believe that gold is incapable of ever going down again! Thanks in advance love your website!
Jenny…Great observation. 640 was a spike low in RUT, support is still there and yes if it goes, I suspect as you say a “free fall” could well be in the cards. Love RUT for its “seeing Double pattern!”
Thanks for this great question and comment,
Now $RUT is breaking neckline 650 like year 2008, free fall from here?