Orko Silver Corp. Daily Chart

Orko Silver Corp. Daily Chart February 13 2010

Marketclub – Orko Silver Corp. Trend Analysis Marketclub - Orko Silver Corp. Trend Analysis (What’s this?)

Greetings fellow Orkonians and good tidings to thee and thine lineage.

Orko Silver Corp. cheap, but not for long is where my you can find my previous review on Orko Silver Corp. As you can read in that article, the market conditions at that time provided plenty of reasons to support the idea of Orko finding some support between $1.00 and $1.20. In my last article anywhere between $1.10 and $1.20 was about as far as I would have thought it would go.

But if you look back at February the 5th you will notice a little spike where we seem to have made a low of $1.06.

So there you go, there is always a lower low

…is what Edgar Allan Poe would write if he were into financial poetry back then.

Luckily for us he wasn’t as he would eventually become known world-wide for his tales of mystery and the macabre, some even consider Poe as being the inventor of the detective-fiction genre. So with the writings of one man the foundations were being created of what later would become a completely separate literary genre with some precious gems like Arthur Conan Doyle’s ‘The Hound of the Baskerville’ and the many tales of Sherlock Holmes.

image of the middle portion of the October 31, 1938 Late City  Edition of The New York TimesMind you, it didn’t stop there as he also influenced certain science-fiction authors like H.G. Wells and Jules Verne with the first one being responsible for writing a story which scared the Hee Bee Jee Bees out of more than one million people and the latter one even writing a sequel to one of Poe’s novels.

So if you know all this do you really think that Orko Silver would really hold up well against this fictitiously fundamentally-deplete dollar rally rippling its way through the markets? With its tantalizing yet dangerous grip on everything it reaches for or touches. Sucking dry everything else in its path which does have any real value’s worth behind it.

Well, just know that certain events will always ripple through to fundamentally-rich entities like in our example…Orko Silver Corp.

The dollar breaking out to over 80.00 would pretty much achieve that ripple-creating effect. Luckily with the fundamentally-rich entity there is nothing wrong! It is only undergoing some of the negative side-effects of the ripple the fundamentally-deplete entity created. Nothing more, nothing less.

And a ripple subsides. Drop a stone in a pond and sure enough, the very first seconds up to the very first few minutes it will probably look like a big expanding circular mess but I am sure everyone here knows that what at first seemed like such a big impact would later literally turn out to be nothing more than what we started with and less, considering that the stone is now on the bottom of the pond. Think that one through for a moment will you!

If you follow where I’m getting at you will already know where this is going.

I am already there. I mean, I am at that place where I don’t feel the need anymore to dump or sell anything just because the dollar is rallying. All because I know that that rally is based on nothing else than hot air and the rally in the shares I am in aren’t. So that means that if some of my shares happen to loose some of their gains that means to my traders brain ZILCH!

I can understand the drop from $1.40 to $1.25 but if normal market conditions would have ruled on those days then that would really have been the support and up we went. Now we are in abnormal market conditions.

Orko Silver going and reaching a low of $1.06 again from $1.47 is just madness. You and me both know that. Absolute madness.

That is a near 30% drop!

30% drop for a junior which even has its name included in the McEwen Junior Gold Index

So, me thinking a 30% drop is madness for a company who not only has proven resources in the ground, a good track record, plenty of finances, the backing of a large partner, a huge silver deposit and a 51.000m drilling program with all those results to look forward to.

Well….call me crazy, tie me up and lock me away in the loony bin but looking from where I’m standing, maybe the angle I’m at or the tilt of the earth combined with my location on it may cloud my very own judgment but no matter which way I look at it…I always come up with the very same conclusion.

I even looked at it while standing upside down. Same conclusion. I tried several other positions, they all lead me to the very same conclusion. Strange is that, isn’t it?

HECK NO. Why in Gods name would that be strange? Why would you even start wondering? Because I posed the question? Because the stock has fallen from earlier highs? Because you ask yourself too many questions after making your investment?

YES! There we are! The asking questions usually is the part we do before we invest.

So, with Orko Silver Corp and basically any other stock you are invested in, the only question left for you to ask yourself is….are all of our initial entry conditions still being met?

Well, looking at Orko Silver I’d say yes! As always, do your own diligence on Orko Silver and tell me where I got my story wrong.

OK, that was the market talk. Now on to the chart :

I’ve highlighted three trading ranges on the daily chart. You can see the first trading range where Orko was trade bound between $0.80 and the resistance area at $1.00. Now there is no problem with there being a trading range cause indirectly every stock has them…sorta…so to speak. Well OK, only the good ones do.

Now, don’t mistake my poor English or lack of choice of words into taking from this that we are stuck in trading ranges or sideways action or some sorts. Cause that is not really what I mean.

I mean, this stock is being tightly held and being slowly brought up to valuation. So it is my opinion that while we will get a very decent bang for our bucks, we will not get the 50 or 100% a day pops like with some of the more ventury ventures. At least….not without some solid news to back those gains.

And to me…that is a pretty darn good thing. Sure I want this to rise but I want a rise based on solid results, on credible results and I want investors entering this stock knowing damn well what they’re getting into and not being scared shitless holding these shares while getting this thing into production. Pardon my French back there -and the added coloration for visual enhancement- but sometimes stating the obvious needs down to earth explanations. In this case,…down to earth can be understood in many ways, it is all in the way something is brought or how broad an imagination one has.

So with that said I even need to back track on what I wrote cause it is not entirely true about the pops. I have no crystal ball of course but there is really no telling what happens to a stock when good results come their way and I probably don’t need to talk about what happens to investors and the burning sensation they feel in their wallet when they see good results passing on the wire….DO I?

So, where was I…oh…trading ranges! When the accumulation of shares was over it took a little under a month to go straight from $0.85 to a high of $1.25.

I don’t know what banks you guys and gals go to but this one just paid 47% in a little under a month.

From there on it was another month of accumulation with a trading range between $1.10 and $1.25. Then it was up to the 3th which was supposed to be between $1.40 and $x.xx were it not for a perhaps not all too unexpected rally in the dollar considering the very bad news coming out of Europe.

Don’t take this as me condoning this baseless rally. Far from it but lets just say I am not surprised.

This just means that those in the dollar or dollar related entities should be extra extra careful cause you really should know that once they have had enough of their little rally they will drop it ditch it as easily as mince pie.

On to the ADX or Average Directional Index :

You can clearly see that after reaching those highs in the 1.40’ies the +DI has been decreasing ever since then. So that means the force of the upward move was over after reaching those highs and looking at a decline from there on. A little later from that decrease an increase started in the -DI or rather, the force of the downward moves started increasing. Back when the +DI was still at 40 the ADX was still doing 40 for a little while longer and only turning down when +DI and -DI crossed. Only then was there for me a real mention of a change of trend from UP to DOWN.

Looking at the ADX chart also tells me we could be getting out of our rut. Yes, the -DI has increased but nothing spectacular and it to me looks like there is not much downward force left. Actually, looking all the way back to October 2008 +DI has always traded higher on average meaning there have since then been more upward forces at work in Orko Silver than there have been downward forces.

That should tell you something at least. Trust me, not all stocks have an average +DI larger than -DI.

I prefer one which has of course. I do not go out and look for them but always an added benefit of knowing there are more buyers than sellers. That is actually what this boils down to really and that is all that counts to put it really minimalistic. Also, don’t take this as a stock having a good +DI -DI relation to be a good and safe bet! Uh Uh. Doesn’t work like that so don’t even try or bother. You will loose money on that.

Besides ADX or technical analysis you need to look at all other things like finances, management, projects, country/location, market condition, political situations and on and on.

So, neutral points or one + on the ADX chart. Neutral because where we are at ADX chart wise is in nowhere’s land. + because we had the switch from strong up to little stronger down. I say little stronger down because -DI has always traded below 20 ever since lets say September 2009 and even going as low as 6.58 so to get to 40 will take quite something. I think aliens stealing La Preciosa will probably take us to 40 and more but until then I think we will be hard pressed to see -DI gaining any sorts of momentum while dancing and prancing around Orko’s chart. If you’re into high -DI’s, try the caveat emptor on the pink sheets but only do so if you enjoy loosing money. In all other cases, stick with either Orko or any of the other promising silver or gold plays out there on the TSX or CVE.

On to the MACD :

The histogram below the center line is slowly decreasing which is a good sign if you’re long. The blue line has stopped going down and is now maybe making a nice rounding bottom before heading back up again. It is however still trending below the center line so unless we creep back up above that center line I have to acknowledge the down which has its territory set up here. So yes, it has stopped the decrease, is now flat and could turn back up which in turn could be the start of another climb from where we are now.

Phew, that were many could’s. Well I’m sorry but when a line which has gone lower for over a month on end turns flat then YES I say it could go up from here. So go and sue me!

So, +++ points on the MACD chart.

On to the volume :

Well, clearly what we would like to see for this to get the two thumbs up is also on the charts right in front of our very eyes.

More buyers, less sellers! Very simple.

So, more people enter and hold then sell. That also should tell you something! It does me.

+++

Orko Silver Corp. Weekly Chart

Orko Silver Corp. Weekly Chart February 13 2010

Marketclub – Orko Silver Corp. Trend Analysis Marketclub - Orko Silver Corp. Trend Analysis (What’s this?)

Like last time, the weekly needs not much digital space. Looking back on the daily, I’ve probably already out done myself on that one and surely by now you will know that if I like the daily then the weekly pretty much won’t be much different.

And this case won’t be an exception to the rule. On the weekly we have broken the 10 Moving Average but we are trading steadily on the 20 Moving Average which hm…coincidentally coincides with the support I think we have around $1.10. MACD is still trading above the center line with a small negative histogram appearing on the chart. But for now too small so I’d rather ignore it for the moment. There is plenty of support to be found, whether at $1.10 or $1.00. At those levels, before you can even get your order through I’m betting you are already looking at an order which won’t get filled if you’re not fast enough.

All in all, yes on the weekly this looks like a whole pullback and certainly more than it should have retreated but still nothing to worry about. My opinion then.

This sounds stupid I know, especially to those holding shares at $1.40 or something like that. Well, investing is also waiting for the right time and consoling yourself in the fact that the money you have invested in Orko probably won’t get lost on some other riskier or miscalculated venture. That is sorta what I tell myself when a company or stock I’m invested in drops me in the red, full well knowing I got the fundamentals covered.

Every trader, be it a short, mid or long term trader has their own entry into various stocks and should have their very own conditions set in place. Stick by them. If any change, if perhaps some red flags get triggered which you have set the parameters for, whatever the reason, act on it.

With that I will leave you for the time being.

Leaves me only to like usual wish you all peace and prosperity and may the force of the precious metals be with you.

Orko Silver Corp - Developing one of the world's largest Silver  deposits

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