In my previous update on Pan American Silver, (which I claimed was an "extremely critical" juncture for metals and miners), I wrote, "We must also beware the ending diagonal finish for wave 2. While I currently do not see this as the highest odds count, that mess in the middle could be a complex a-b-c and we could begin turning down tomorrow with the broader markets. Again, a fall below $13 is probably enough to make me hit the sidelines on this trade. We should know pretty quickly which is why I consider this an important time to pay extra close attention to metals and miners."
I wrote that on April 9th after markets closed. The very next day, PASS began to sell off. In fact, it went on to finish 5 clear waves down into blue 1 as shown below. I wish there was some way to model this as an ending diagonal but that possibility was recently blown away by the presence of a lower low labeled "uh oh" in the chart below.
Because of that, the recent spike was wave 2 and now we are working on not just a 3rd wave down, but the 3rd of a 3rd and that means gap down city is likely for metals and miners.
So now I think that M+M could very well see a few more months of selling such that PAAS forms a double bottom as shown. In other words, this chart suggests that M+M will initially dip with the broader markets and then M+M should recover while the broader markets keep going down. Way down.
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