I'm really liking the action tonight. Frankly, I was expecting this last night and $4 higher but I digress.
Take a look at this. Note that just as the top last week came as a parabola, today's action has put a downward parabola on this hourly chart.
that can't continue. We are ripe for a bounce for a number of reasons:
1) POSX has already run into the top-end of its Calvin near 74.25 on the June.
2) Silver down over 25% in 4 days.
3) Potentially lousy BLSBS report tomorrow am.
4) We already know that margins are being raised again Monday night. This removes a lot of the overhanging uncertainty, at least for a few days.
5) Seemingly everybody and their brother is now short silver.
IF silver can continue to rally, a virtuous cycle will develop. If you shorted anytime from noon yesterday to today, you're sitting on a healthy profit. As silver moves higher, you start thinking about ringing the register. Above $37, it gets pretty tempting to cover. At $39, the chart starts to look like a panic/capitulation bottom is in. Buyers begin to see a market whose fundamentals haven't changed yet is priced at a 20-25% discount to it's highs. Shorts begin to get squeezed and begin to cover even more quickly. This is what I HOPE will happen.
A word of caution, however. The pace and duration of the rebound will dictate whether we see a V-shaped or a double bottom. This must be closely monitored. Thankfully for you, I will be happy to do the monitoring. All you have to do is check back regularly for updates.
Good night and good luck. TF