Thread: How to make quick money when Silver crashes

Hey all you forexforum.net-ters! Here's an article you may find helpful especially in a time like this: how to benefit from the Silver crash: ENJOY

The US Commodity Futures Trading Commission is seeking to draft new regulations to stop market manipulation, with a proposal expected at the end of the year. Silver investors reacted hysterically to this news on Monday, resulting in silver futures fall of more than 10% that day!

This panic has resulted in many investors losing great amounts of money. However, this is good news for professional intra-day-traders: could earn quick profits out of the huge gap by using the "Bottoming" system or a system that waits for the gap to close, which is this article's theme.

First of all, it is important to understand WHY sellers show up when a significant gap is closed. Investors, who bought the silver contract before it crashed, probably did not close their position in a 10% loss. They waited for the gap to be closed, completely or partly, in order to minimize the loss as more as possible. Eventually, when silver returned to the previous day's opening price, many of its holders got rid of it. In addition, day traders who wanted to ride on this gap took their profits in that price level too. These 2 phenomena are the reasons why a stock / currency/ commodity changes its direction after the gap is closed.

In this case, it was possible getting in under the long Doji's low at $45.63, in the 4-hours chart, or even before that, at $46.20 in the 1 hour scale. The movement of this trade was extremely wide: more than 5 points, or 10% within less than one day. If you didn't open a short position around that levels and you are thinking about going in the extreme point of the trend, you should reconsider it, since strength indicators show that a correction up is about to come...

Great article! Thanks for sharing, where did you find it ?