RCM Chart of the Day 6/8/12: Weekly Silver

Above you see a weekly chart: so let me touch on the longer term perspective and then I will also speak to the short term action.

What I draw from this chart is 3 things: silver is oversold on the weekly chart, prices have completed a 50% Fibonacci retracement and a trend line that has held since late 2008 was challenged and held in recent weeks.

Now let me touch on the short term price action. I've been very clear in my daily post when speaking about silver but to reiterate as long as silver futures stay above $28/ounce I remain friendly. On the upside once prices clear $29.50 I'm anticipating a trade closer to $32.

I like the idea of futures for those with the capital and stomach. Also I've devised an options strategy that I think is perfect for those that are fairly bullish out until the end of the year thinking we have little downside. I am in that camp so what about selling December $20 puts and then purchasing $35/40 bull call spreads. Contact me to discus the upside and the risks.

To discuss in more detail this chart or any other you can reach me at: mbradbard@rcmassetmanagement.com or 954-929-9997

Risk Disclaimer: The opinions contained herein are for general information only and are not intended to provide specific investment advice or recommendations and are not tailored to any specific's investor's needs or investment goals. You should fully understand the risks associated with trading futures, options and retail off-exchange foreign currency transactions (“Forex”) before making any trades. Trading futures, options, and Forex involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change without notice. Past performance is not necessarily indicative of future results