Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
US Economy Has Been in an Economic Depression Since 2008 - 22nd Oct 21
Extreme Ratios Point to Gold and Silver Price Readjustments - 22nd Oct 21
Bitcoin $100K or Ethereum $10K—which happens first? - 22nd Oct 21
This Isn’t Sci-Fi: How AI Is About To Disrupt This $11 Trillion Industry - 22nd Oct 21
Ravencoin RVN About to EXPLODE to NEW HIGHS! Last Chance to Buy Before it goes to the MOON! - 21st Oct 21
Stock Market Animal Spirits Returning - 21st Oct 21
Inflation Advances, and So Does Gold — Except That It Doesn’t - 21st Oct 21
Why A.I. Is About To Trigger The Next Great Medical Breakthrough - 21st Oct 21
Gold Price Slowly Going Nowhere - 20th Oct 21
Shocking Numbers Show Government Crowding Out Real Economy - 20th Oct 21
Crude Oil Is in the Fast Lane, But Where Is It Going? - 20th Oct 21
3 Tech Stocks That Could Change The World - 20th Oct 21
Best AI Tech Stocks ETF and Investment Trusts - 19th Oct 21
Gold Mining Stocks: Will Investors Dump the Laggards? - 19th Oct 21
The Most Exciting Medical Breakthrough Of The Decade? - 19th Oct 21
Prices Rising as New Dangers Point to Hard Assets - 19th Oct 21
It’s not just Copper; GYX indicated cyclical the whole time - 19th Oct 21
Chinese Tech Stocks CCP Paranoia, VIES - Variable Interest Entities - 19th Oct 21
Inflation Peaked Again, Right? - 19th Oct 21
Gold Stocks Bouncing Hard - 19th Oct 21
Stock Market New Intermediate Bottom Forming? - 19th Oct 21
Beware, Gold Bulls — That’s the Beginning of the End - 18th Oct 21
Gold Price Flag Suggests A Big Rally May Start Soon - 18th Oct 21
Inflation Or Deflation – End Result Is Still Depression - 18th Oct 21
A.I. Breakthrough Could Disrupt the $11 Trillion Medical Sector - 18th Oct 21
US Economy and Stock Market Addicted to Deficit Spending - 17th Oct 21
The Gold Price And Inflation - 17th Oct 21
Went Long the Crude Oil? Beware of the Headwinds Ahead… - 17th Oct 21
Watch These Next-gen Cloud Computing Stocks - 17th Oct 21
Overclockers UK Custom Built PC 1 YEAR Use Review Verdict - Does it Still Work? - 16th Oct 21
Altonville Mine Tours Maze at Alton Towers Scarefest 2021 - 16th Oct 21
How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
The Only way to Crush Inflation (not stocks) - 14th Oct 21
Why "Losses Are the Norm" in the Stock Market - 14th Oct 21
Sub Species Castle Maze at Alton Towers Scarefest 2021 - 14th Oct 21
Which Wallet is Best for Storing NFTs? - 14th Oct 21
Ailing UK Pound Has Global Effects - 14th Oct 21
How to Get 6 Years Life Out of Your Overclocked PC System, Optimum GPU, CPU and MB Performance - 13th Oct 21
The Demand Shock of 2022 - 12th Oct 21
4 Reasons Why NFTs Could Be The Future - 12th Oct 21
Crimex Silver: Murder Most Foul - 12th Oct 21
Bitcoin Rockets In Preparation For Liftoff To $100,000 - 12th Oct 21
INTEL Tech Stock to the MOON! INTC 2000 vs 2021 Market Bubble WARNING - 11th Oct 21
AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
Stock Market Wall of Worry Meets NFPs - 11th Oct 21
Stock Market Intermediate Correction Continues - 11th Oct 21
China / US Stock Markets Divergence - 10th Oct 21
Can US Save Taiwan From China? Taiwan Strait Naval Battle - PLA vs 7th Fleet War Game Simulation - 10th Oct 21
Gold Price Outlook: The Inflation Chasm Between Europe and the US - 10th Oct 21
US Real Estate ETFs React To Rising Housing Market Mortgage Interest Rates - 10th Oct 21
US China War over Taiwan Simulation 2021, Invasion Forecast - Who Will Win? - 9th Oct 21
When Will the Fed Taper? - 9th Oct 21
Dancing with Ghouls and Ghosts at Alton Towers Scarefest 2021 - 9th Oct 21
Stock Market FOMO Going into Crash Season - 8th Oct 21
Scan Computers - Custom Build PC 6 Months Later, Reliability, Issues, Quality of Tech Support Review - 8th Oct 21
Gold and Silver: Your Financial Main Battle Tanks - 8th Oct 21
How to handle the “Twin Crises” Evergrande and Debt Ceiling Threatening Stocks - 8th Oct 21
Why a Peak in US Home Prices May Be Approaching - 8th Oct 21
Alton Towers Scarefest is BACK! Post Pandemic Frights Begin, What it's Like to Enter Scarefest 2021 - 8th Oct 21
AJ Bell vs II Interactive Investor - Which Platform is Best for Buying US FAANG Stocks UK Investing - 7th Oct 21
Gold: Evergrande Investors' Savior - 7th Oct 21
Here's What Really Sets Interest Rates (Not Central Banks) - 7th Oct 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Silver Showing Amazing Strength

Commodities / Gold and Silver 2011 Feb 20, 2011 - 07:07 AM GMT

By: Clive_Maund

Commodities

Best Financial Markets Analysis ArticleSilver has shown amazing strength in recent weeks, surprising even its staunchest advocates by making light work of recovering the ground lost in the January reaction, and even went as far as to break out to new highs late last week, hugely outperforming gold in the process, which not unnaturally has silver bugs *****-a-hoop. We were looking for a big rally in the last update posted at the end of January and we have not been disappointed.


The breakout to new highs last week was undoubtedly a very bullish development and it makes an advance towards $50 a reasonable objective for later this year. However there are signs, principally in the behaviour of gold and Precious Metals stocks, including the volume patterns in individual silver stocks, that silver is first going to react back before it continues much higher.

On its 8-month chart we can see the bullish engulfing candlestick pattern that was a factor enabling us to predict the rally, and as we had also expected the large number of traders who had bids in near the $25 support level were left standing at the station as the train pulled out without them.

Despite the longer-term bullish implications of the breakout to new highs, silver is thought to be very close to topping out now on a short to medium-term basis, which has more to do with what we can see developing on the gold charts and the charts of PM stock indices and individual silver stocks, than it has to do with the silver chart, although we can see that silver on Friday hit a trendline target which could mark the top of a broadening pattern that silver could now react back across.

If silver is now destined to react back with gold and PM stocks, how far might it drop? A reasonable objective for a reaction would be the January low from which this advance started, although bearing in mind the obvious strength displayed in recent weeks, it may not drop back further than the support level in the $28 area.

The latest silver COT chart shows that the Large Specs have ramped up their long positions again over the past couple of weeks, and remember that this chart is only up to date as far as last Tuesday's close, so we can expect their positions to be considerably higher than shown here after silver's sharp rise on Thursday and again on Friday, which means that downside risk has reappeared. The COT chart was a factor that assisted us in determining that silver was set to rally in the last update, as at that time the Commercial short and Large Spec long positions were at a very low level.

By Clive Maund
CliveMaund.com

For billing & subscription questions: subscriptions@clivemaund.com

© 2011 Clive Maund - The above represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maunds opinions are his own, and are not a recommendation or an offer to buy or sell securities. No responsibility can be accepted for losses that may result as a consequence of trading on the basis of this analysis.

Mr. Maund is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations mentioned in his reports. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications.

Clive Maund Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Comments

Bob
21 Feb 11, 09:05
silver possible pull back?

Markets correct all the time but I think that this silver market is different than others How? All fiat currencies are failing at the same time.

It seems that people, nations can't get enough. In the USA no one other than Gold and Silver Bugs are buying. Why? This country has never experienced a failed currency. When that happens than everyone will be trying to buy, but good luck there will be none to be had unless the price is right.

I'll sell but no for US dollars.


Onc' Scrooge
21 Feb 11, 13:47
Failed US Currencies?

Hi Bob,

your comment on Clive's article is not right:

your country (like the mine) has had a lot of failed currencies:

- colonial notes in the 177x

- continental notes of the 178x

- notes of the free banks 1836 to 186x

the FED of San Francisco is writing about this time:

"By 1860, an estimated 8,000 different state banks were circulating "wildcat" or "broken" bank notes in denominations from ½ cent to $20,000. The nickname "wildcat" referred to banks in mountainous and other remote regions that were said to be more accessible to wildcats than customers, making it difficult for people to redeem these notes. The "broken" bank notes took their name from the frequency with which some of the banks failed, or went broke."

- CSA-Notes gone to less than a penny in 1865

but it's a long time ago and it's not in mind of the people

Take example on the great German inflation with witness of Ernest Hemmingway in summer of 1922 coming from France to Germany he wrote:

"...we changed some French money in the railway station at Kehl. For 10 francs I received 670 marks. Ten francs amounted to about 90 cents in Canadian money. That 90 cents lasted Mrs Hemingway and me for a day of heavy spending and at the end of the day we had 120 marks left! ...the mark at 800 to the dollar, or 8 to the cent, a pound of coffee could be had for 34 marks. Beer was 10 marks a stein, or one cent and a quarter. Kehl's best hotel served a five-course meal for 150 marks, or 19 cents.... This miracle of exchange makes a swinish spectacle where the youth of the town of Strasbourg crowd into the German pastry shop to eat themselves sick, and gorge on fluffy, cream-filled slices of German cake at 5 marks the slice...."

So in 1922 "sound" Canada-$ were changed into inflationary Marks why not in 2012 "sound" Canada-$ into inflationary US-$ at the same level ?

(REMARK: a Canada-$ of the time was equal to an US-$ a worker in San Francisco earns in 1922 about 8 $ a day (**) - a worker in Germany 30 Marks means 3.75 Cents a day (!))

(**) Bureau of Labor Statistics, United States, History of Wages in the United States from Colonial Times to 1928, Washington

Somebody who reads these statements from Hemminway can't be ignorant to the possible distinct of the US - if he is a PM-Bug or not.

I think it's more or less a lack of education, of knowledge of his own history but also of the money system which makes the people behave like (gouvernment- and bank-beloved) sheeps interested only in the cream-filled slices but not in the rest of the story ?

Onc' Scrooge


Post Comment

Only logged in users are allowed to post comments. Register/ Log in