Futures Market - Silver Highlight #6
Gap and channel trading strategy explained in "The
$upertrader's Reference Manual" ALIGNS WITH "Astro Point" information
listed in "The 1998 $upertrader's Almanac - 2nd Half Edition" ends 2 month price
rally.
(COMMENT # 541)
UPDATED 19980729
COMMENT 1998-541
(Make sure and use day session only prices for the following);
1. Next, let's return to the silver market.
2. We last reviewed and pyramided this market in COMMENT #s 445, 452, 517, and 536.
3. Grab a chart of the September contract.
4. Draw an up trendline off the 980529 and 980713 lows.
5. Now create an up channel by drawing a parallel up trendline off the 980609 high.
6. Now draw a down trendline off the 980319 and 980529 lows.
7. Now create a down channel by drawing a parallel down trendline off the 980205 high of the year.
8. If you've done this correctly, the channel trendlines should intersect at last Thursday's close.
9. This market appeared to experience a breakout gap from 980721 to 980722.
10. The gap is from 55750 to 56250.
11. Price then ran into the "A & P Points" of 980723 and the channel trendlines and hit a wall.
12. We're now in the process of testing the gap.
13. The market still appears to have completed a clear "A-B-C" correction from the high of the year on 980205 to the 980529 low.
14. The market thus appears to be in the process of emerging to the upside.
15. If this market is able to trade into the gap and close above the gap, the THRUST trading technique should be applied (see pages 115-6 of "The $upertrader's Reference Manual").
16. Ideally, when the new high was made early in the day on 980724, the trading technique on pages 236-238 of "The $upertrader's Reference Manual" should have been immediately applied in light of the "A & P Point"/channel trendline ALIGNMENT.
17. Such positions can always be quickly reversed and positions reentered.
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