Gold and Silver ETF Update – 050712

Since my last update of gold etf and silver etf trades, silver has slowly drifted lower, while gold has stayed near the same 1630 level.  I thought the hourly gold chart might send it to 1580, but that did not occur.

I’ve been sitting in the bearish Silver ETF – DSLV for a month now… looking for the 38 range trade. We are about there. One characteristic I have seen, when it comes to the gold and silver sector, is that they can go to extremes more than other sectors.

Attempting to pick a bottom here may still be too early. When I do sell DSLV, I don’t expect to jump on any long side silver ETF trades immediately. Unless of course, there’s a decent setup.

When I mention extremes in the sector, I can refer to the Gold Miners Bear ETF – DUST, and the Gold Miners Bull ETF – NUGT. Both ETF’s are moving into their seventh week of consecutive higher highs, and lower lows respectively. I’m a big fan of seven as a turnaround number, where a reverse can happen. Is this seventh week a spot to unload DUST if I was holding? I think so. I would first need a setup to then purchase NUGT. Currently, we have a nr7 setup forming. That combined with an entry on the 15 min. or hourly chart would be a trade I would try. It wouldn’t surprise me however if it failed. That’s where the extreme move may come in. With the trend currently down, I want to put as much capital on a reversal trade, as I would one following the trend.

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