Silver Market Update

By: Clive Maund | Tue, Oct 2, 2012
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Originally published October 2nd, 2012

The story for silver at this point is much the same as that for gold, but as usual, more extreme - with silver there are bigger gains to be harvested, and bigger prospective profits if it now reverses violently to the downside, which could be occasioned by a larger dollar rally, as predicted on the site at the weekend. Silver made a new intraday high yesterday, ended the day with a bearish "Shooting Star" on its chart, again on higher volume, and looks vulnerable to a sharp drop if the support in the $33.40 area is breached. Tactics for traders here are clear cut and simple and the same as for gold - TAKE PROFITS AND GO SHORT, but reverse position immediately following a close above yesterday's intraday high, should this occur. Overhead stop out point is close by and well defined, so risk is known and limited.

$SILVER (Silver - Spot Price (EOD)) CME

The latest silver COT chart shows that Commercial short and Large Spec long positions have risen even more to another record for the period of this chart - the Large Specs are clearly "betting the farm" on this uptrend, so it will be really sad for them if they get it wrong - it would have been better for them if they had done this back in June, when silver was $6 cheaper. This chart is, or should be, profoundly alarming for any traders long silver at this point.

Silver COT

 


 

Clive Maund

Author: Clive Maund

Clive Maund,
CliveMaund.com

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.

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