Thursday, December 15, 2011

In Case There Was Confusion...

A reader asked if the new 33.00 buy stop was correct for the short SLV trade, thinking I meant 23.00. I didn't know if anybody else had this confusion. I had previously recommended a GTC buy limit order to exit the position, but I am now recommending to just cancel that limit order and wait for things to unfold. What I did suggest is to move the protective stop loss on the short position down to 33.00 from the 36.50 area.

Here was my brief reply with a little more info..

"This is a short position in silver. So the buy to cover stop is above current prices. That is the stop loss to trail behind the trade. I am not going to post a limit order to exit the trade yet if that's what the confusion was. The prior limit was 26.00 but I am just suggesting to cancel that right now. I think it has a lot further to fall. Probably 17.50 will be the next limit order, but I'll just trail the stop for now and see how it develops for a while."

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