To gain an edge, this is what you need to know today.

There is a big opportunity in silver. All you need to know is the massive money printing and government borrowing that is going on.  There is merit to buying physical silver for the long term and using ETF SLV for trading.  However, there is no merit to paying massive premiums for physical silver over spot.  If you followed The Arora Report signals for core long term silver positions, you were able to buy silver at times at a discount.

As a public service, we are publishing this post to help investors not get burned by old wives’ tales and the highly flawed analysis that is prevalent.

Here is your opportunity to learn how not to get burned and make spectacular profits — here is a post from the paid services of The Arora Report:

OLD WIVES’ TALES BURN MOM AND POP SILVER INVESTORS, BIDEN’S TRILLIONS

Old Wives’ Tales

Please click here for a chart of silver ETF (SLV).

Note the following:

  • Yesterday, when silver was trading much higher, we wrote in ZYX Buy:

If CFTC increases the margin, a reasonable expectation is that silver will fall by about 10%.

  • Our call was to take partial profits in the Trade Around position.
  • The call has now proven spot on. Subsequent to our call  CME raised margin requirements and silver fell.
  • The chart shows support resistance lines.
  • Short sellers also got burned because they are still using the methodology of the 1990s of putting stops.  Their stops were just above the top resistance line shown on the chart.
  • All of those stops were taken out by smarter players who know where most investors put their stops.
  • Over the weekend, moms and pops rushed to buy silver motivated by old wives’ tales. We will not spread these false stories by repeating them here.
  • Take a look at the chart for the price of ETF SLV.  It is trading at $25.32.  Over the weekend, many investors paid over $40 per ounce.  Of course, they will claim that they have not lost any value because they have not sold what they bought.  However, from a long-term investment point of view, it is difficult to come out ahead when such huge premiums are paid.
  • Silver has many uses that are promising such as those in electric cars and solar panels.
  • Silver is an excellent conductor of electricity but it is expensive.  For this reason, less and less silver is being used for each connector point — the typical use of silver.
  • Much of the analysis out there is flawed and backward-looking.
  • Silver bulls make hay out of gold/silver ratio which has steadily dropped.
  • When was the last time you used a camera with film?  Film was one of the biggest uses of silver.  That use is now gone but most of the analysis out there does not take this into account.

Biden’s Trillions

The momo crowd is excited that Biden appears to have rejected a proposal from Republican Senators to borrow less and provide more targeted stimulus.  Democrats seem determined to borrow trillions and give away free money including to those who do not need it.  A large part of this money will flow into the stock market.

Momo Crowd And Smart Money In Stocks

The momo crowd is 🔒 (To see the locked content, please take a 30 day free trial) stocks in the early trade.  Smart money is 🔒.

Gold

The momo crowd is 🔒 gold in the early trade.  Smart money is 🔒.

For longer-term, please see gold and silver ratings.

Oil

The momo crowd is 🔒 oil in the early trade.  Smart money is🔒.

For longer-term, please see oil ratings.

Markets

Our very, very short-term early stock market indicator is 🔒.  This indicator, with a great track record, is popular among long term investors to stay in tune with the market and among short term traders to independently undertake quick trades.

Interest rates are ticking up and bonds are ticking down.

The dollar is stronger.

Trading futures is not recommended for most investors. The purpose of providing this information is to give an indication of the premarket activity that usually guides the activity when the market opens.

Gold futures are at $1833, silver futures are at $27.63, and oil futures are $55.08.

S&P 500 futures resistance levels are 3800, 3860 and 4000: support levels are 3630, 3600 and 3520.

DJIA futures are up 254 points.

Protection Bands and What To Do Now?

It is important for investors to look ahead and not in the rearview mirror.

Consider continuing to hold existing positions. Based on individual risk preference, on dips, consider holding 🔒 in cash or treasury bills or short-term bond funds or allocated to short-term tactical trades and short to medium-term hedges of 🔒 and short term hedges of 🔒. This is a good way to protect yourself and participate in the upside at the same time.

You can determine your protection bands by adding cash to hedges.  The high band of the protection is appropriate for those who are older or conservative. The low band of the protection is appropriate for those who are younger or aggressive.  If you do not hedge, total cash level should be more than stated above but significantly less than cash plus hedges.

It is worth reminding that you cannot take advantage of new upcoming opportunities if you are not holding enough cash.  When adjusting hedge levels, consider adjusting partial stop quantities for stock positions (non ETF); consider using wider stops on remaining quantities and also allowing more room for high beta stocks.  High beta stocks are the ones that move more than the market.

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This post was just published on ZYX Buy Change Alert.

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