The markets continue to rumble upwards in what’s been a great start to the year. Don’t worry too much about whether you think the market should be up or down – the fact is that it is up and we can only trade what we see.
One thing is for sure, trading the way we do, using the OVI with breakout patterns, we never get caught completely with our pants down. Some trades won’t turn out as good as others – that’s trading – but we never have catastrophic losses, which is one of the reasons we’re always in the game
SLV
A strong day today (which you can’t see in this chart) but by the early hours our OVI chart will have been updated. SLV is poised for a breakout from the lower resistance line and with today’s strong up bar I’m anticipating the OVI will be in positive territory. This tees up a potential move, but kake sure you check first. One consideration here is that there is another resistance area defined by the October/November highs. I would consider managing any trade of this chart with a rising trendline from the January lows.
GLD
GLD is in a similar situation to SLV with many commentators willing it to 200. Today saw a strong up bar (not shown) taking this Gold ETF towards 170 and just below the lower resistance line in the chart. A few points higher is another dotted line signifying the resistance defined by the November highs, so bear that in mind. The OVI has been postiive since the beginning of January, so a breakout would not be surprising.
I’ll be back again later this week … be sure to read my next email as there’s a real treat in store …
All the best
Guy Cohen