FIRST MAJESTIC SILVER - PRESSURE BUILDING
Updated
This is a weekly chart of AG, First Majestic Silver Corp. I like to call this pattern a giant compression wedge - it's just a simple descending triangle. But considering this is on the weekly timeframe, it's a mammoth-sized wedge. I like the pattern but I really like the company. I'll try to focus on the technical analysis, but First Majestic looks incredibly well positioned for what's unfolding in the metals market. They have their ducks in a row.
If you follow my ideas, then you'll know how I feel about precious metals. I believe we're facing a perfect storm that will propel precious metals & miners to incredible levels. The monetary circus, supply & demand, inflation, gold:silver ratio, and the commodity cycle are just a few of the ingredients in the recipe.
I'm torn about direction. Equities, the dollar, precious metals, and the miners are in a pivotal place. The dollar looks like it's trying to find a bottom. It's possible that the metals, miners, and equities get pushed down hard again.. potentially another crash. Having another crash in equities, metals, miners, etc.. would be my preferred path because I suspect that it wouldn't last long.. Inflation is coming but don't rule out another deflationary hiccup. I like to buy stuff cheap and so I'll be thrilled to have another discount. Watch the dollar. I think we're going to know soon.. and watch First Majestic. It would be incredible to have it tag (E) of this wedge. The measured move of this pattern is somewhere around 39-40 but a move from $4.00 to 40 is a 10x compared to the 2x it is from current prices.
If you follow my ideas, then you'll know how I feel about precious metals. I believe we're facing a perfect storm that will propel precious metals & miners to incredible levels. The monetary circus, supply & demand, inflation, gold:silver ratio, and the commodity cycle are just a few of the ingredients in the recipe.
I'm torn about direction. Equities, the dollar, precious metals, and the miners are in a pivotal place. The dollar looks like it's trying to find a bottom. It's possible that the metals, miners, and equities get pushed down hard again.. potentially another crash. Having another crash in equities, metals, miners, etc.. would be my preferred path because I suspect that it wouldn't last long.. Inflation is coming but don't rule out another deflationary hiccup. I like to buy stuff cheap and so I'll be thrilled to have another discount. Watch the dollar. I think we're going to know soon.. and watch First Majestic. It would be incredible to have it tag (E) of this wedge. The measured move of this pattern is somewhere around 39-40 but a move from $4.00 to 40 is a 10x compared to the 2x it is from current prices.
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^ that is, torn about short-term direction.Note
WOW. Well, that was incredible. I posted this last night but I was looking at the daily & weekly timeframe and had no idea it was already breaking out. It'll be interesting to see if this is the breakout move.. It's either a fakeout or the beginning of a very big run. Note
*A VERY IMPORTANT LESSON IN IMPLIED VOLATILITY AND BEING CONTRARION*A trap was set for many, many people on main street. It started with Game Stop (GME) but as luck would have it, we saw a big spike in the vix. The premiums in options across the board were at incredible levels.. This was especially true of GME but it was also true of many of the silver stocks. I think it was a clever trap. The timing of the VIX spike along with all this money coming in caused implied volatility to rocket. I was already long some call options in First Majestic and quickly got out because of the high premiums. I didn't want to sell but I'm glad I took some profit and walked away. I even cashed out of some very long term contracts in silver. This is an important lesson in why you do not want to follow the herd. The masses are like sheep and they always get slaughtered.
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*^ contrarianNote
AG MONTHLY DPMINeed to see a few positive months here to confirm trend change
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