Wednesday, April 20, 2011

Trade Update: JPM

Today is a very interesting day for our short position and possibly JP Morgan as well. Today JP Morgan closed down nine cents at $44.56 while spot silver closed at $45.17. This is the first day that silver traded higher than the shares of JP Morgan itself. This is important because Max Keiser is reporting that the bad bank is putting up it's shares as collateral against it's open 3.3 billion ounce short silver positions. That strategy might have made sense a week ago, but now it's time has gone.

I want to point out that the $SLV closed up over a buck today at $44.12. Oddly SLV rarely moves by more than a dollar. As it's price goes skyward I expect that to change too.

We are short from $47.20 with a two dollar stop. I am blocking out the noise and focusing on the chart. Whatever machinations are working behind the scenes will eventually show up there. From the chart I have admit that it looks as though JPM is trying to form a double bottom at the $44 zone. With the stochastics turning back up I would not be surprised to see JPM make it as high as $46. The strategy here is to wait for a break of $42 then add on the remainder of our short position. If that occurs in tandem with a break above $50 of silver I recommend that you sell your parents and spouse into slavery and pour that money into JPM puts.

Of course we may simply be stopped out, this time. JP Morgan is a bad bank living off of public subsidies and influence pedeled up and down K street. Regardless of the near term fluctuations the fact remains that the squeeze is on and Morgan is caught short. It wont be more than six months before this ailing bank goes the way of Enron. Thats my opinion, but I don't trade my opinion I trade the market. Keep your stops at $49.20.

1 comment:

Anonymous said...

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