Silver has a Rat Trap of it's own baited to snare dem evil Rat Bastids over to da PPT. Silver's trap is locked and loaded a 13.03. In Friday's post we recognized the potential for dem Rat Bastids to try and steal the bait from our gold trap. We recognized that potential purely on technicals. But dem Rat bastids got a helping hand from the "existing homes sales" numbers Friday... And we got a "quick" retest of our 655.50 trap in Gold, and 13.03 in Silver as well.
Yesterday, we see that Friday's "helping hand" was a bit limp. Monday, "new home sales"plummeted to 16 year lows. Of course several anal-ysts claimed that "bad weather" caused this absymal number to materialize and should account for the shock of it. Of course, of course, had to be the bad weather. Seems I can't recall the ever blaming "good weather" for a rise in home sales. But I digress...
The US Dollar's decline resumed with Monday's weak housing data.
These retests of our fully baited traps has strengthened them both. By establishing support at these points the pressure builds on the shorts. The further we move up from them, the more the pressure builds. We want these traps to be the catalyst for a short squeeze...perhaps launching the mother of all short squeezes.
Please click on chart to enlarge.
Silver Resistance: 13.36 / 13.54 / 13.67
Silver Support: 13.25 / 13.16 / 13.03
Gold Resistance: 668.50 / 670.30 / 674.50
Gold Support: 662.10 / 658.30 / 655.50
A must read for silver traders: http://www.zealllc.com/2007/tacsilv6.htm