Taking Profits in Silver

The May Call option we purchased (2140 strike price) for $2705.00 (see our post:  Going Long Silver on Breakout Above Sideways Channel)  today is worth $6200.

We sold our May Call option and took the $3489 in profit.  Yes, prices could have gone up to 24.00 or higher (see our previous post about how high we anticipate prices to go), but we don’t leave over 100% profit on the table unnecessarily (Remember:  30% ROI would be considered great in any other investment.  If we can get triple-digit percentage gains in just a few days with our commodity futures and options trades, there is no need to get greedy!)

 

Going Long Silver on Breakout Above Sideways Channel

As we discussed in our post: Silver Moving in Sideways Channel, we have been waiting for a break above or below the sideways channel that Silver Futures have been stuck in for the past 3 months.  See the Daily and Intraday Silver Charts below.

Today, prices spiked up to 21.32, clearing breaking though the top side of the channel shown in the Daily Silver Chart below.  Therefore, we are going long Silver Futures with the purchase of a 21.40 Call Option for a premium of $2,705.00.  This option expires on 4/24/14.

We anticipate prices to move up to the same degree as they moved sideways.  Therefore, we are looking at an upside target of approximately 24.00.

Daily Silver - May 2014Intraday Silver Prices

Silver Moving in Sideways Channel

As can be seen in the Daily Silver Futures chart below, Silver has been moving sideways since early December.   The low end of this channel is 18.72 (on Dec. 31) and the high side is 20.48 (on Dec. 11).

We will go long when prices break above the high side and short silver if prices break below the low end (we anticipate prices to go up, not down, but we can trade it either way).  We will watch Silver Futures carefully to see how prices go to determine if we go long or short.  The longer this sideways channel goes, the more up or down it will go when prices do finally break thru the channel.  Stay tuned.

Daily Silver - March 2014