As you know, much of what I do here is pattern recognition. My technique works because:
1) We are in a long-term, bull market in the precious metals.
2) The fundamentals are overwhelmingly positive and not changing anytime soon.
3) The metals are openly manipulated and capped by an increasingly ineffective Cartel of bullion banks.
When you combine these three elements, you get patterns of behavior that repeat and become predictable. Tonight, I found something else for you to consider as we enter the last 10 days of April.
Remember, "first notice" day for the May silver contract is April 29. This is the day by which any May contract holder that wishes to exercise his contract for 5000 ounces of physical silver must have on deposit in his account 100% of the purchase cost. Its kind of a "put up or shut up" day. By the 29th, most folks will have rolled their May contracts into the next delivery month of July. However, some will stand for delivery. The question is, how many? In November of last year, we were all aflutter that the Comex might break in December. As an example, please read Harvey's post from November 18, 2010. Note the price action, the volume and the open interest numbers:
Obviously, The Comex won their game of "chicken" in December and the focus eventually turned to the next delivery month of March. After reaching a low at Turd's Bottom in late January, silver was rolling by mid-February. As another example, read Harvey's post from February 19, 2011. Again, note the price action, the volume and the open interest numbers:
As we all know, after much chagrin and grinding of teeth, The Cartel managed to settle all of the March longs and now the focus has turned to May. As your final example, think about the recent price action in silver and read Harvey's latest for today, April 19, 2011:
OK, so what's the point...besides the obvious fact that Harvey simply recycles his copy every 60-90 days?
The point is pattern! As we approach first notice day, the pattern seems to be the same. A rally in price from mid-month until about the 22nd. A Cartel-induced selloff for 2-3 days designed to "encourage" those considering standing for delivery to roll forward, instead. Then a rally into the end of the month.
Here, see for yourself:
There is simply no reason not to think that this pattern won't repeat again this month so be prepared. As you know, I am long May 43s, 44s and 45s. I plan to be out of them all by Thursday noon, at the latest. Then, I fully expect to buy a dip by the middle part of next week. I will ride my new purchase to the new highs that will come the first week of May.
That's it for tonight. Learn it, know it, live it and get ready for tomorrow and Thursday. TF out.
9:00 am EDT UPDATE:
No funny pictures this time as this is getting serious. The US$ is in some deep doo-doo. Look at the action overnight:
I'll let this sink in for a while and I'll be back with a new thread in about 90 minutes. TF