Silver Market Update

By: Clive Maund | Mon, Dec 19, 2005
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Silver's action in recent times has quite closely paralleled that of gold and so much of what has been written in the Gold Market update can be taken to apply to silver, except, obviously, prices and support levels. Silver staged a reversal day last Monday after becoming very overbought, similar to that in gold, and then went on to react sharply, although by Wednesday - Thursday it was already stabilizing above support at the April 04 highs in the $8.40 area, which it had earlier succeeded in breaking above by a significant margin.

The Reversal Day last Monday is believed to signal an end to the intermediate uptrend that began in September, and if so, a lengthy period of consolidation/reaction is to be expected, mirroring the situation in gold. Although a short-term rally is to be expected next week following last week's plunge, it is considered unlikely that it will get very far, after which renewed decline it to be expected. It should be noted that if silver drops back into pattern, by breaking back below the April 04 high at about $8.40, and perhaps heads for support in the $8 area, it will not negate the overall bullish pattern.


 

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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