Silver Market Update
The jury has returned its verdict - "Silver has double-topped with its April highs". So silver bulls can forget about any new highs for a while. Although silver has powerful bullish forces underpinning it, the same factors that are set to precipitate an intermediate reaction in gold, principally a rally in the dollar, are expected to have a similar effect on silver, although due to the strength of the bullish forces at work in silver, it is considered more likely that a trading range will develop, lasting perhaps several months.
On the 6-month chart we can see the phoney break higher on Thursday, that failed to take the price well clear of the April highs, and the reaction on Friday that accelerated dramatically today, as the metals had the rug pulled out from under them by today's snapback rally in the dollar, mentioned as a growing probability in the big article on the site at the weekend.
Given the severity of today's drop, especially in gold, it is quite likely that we will see a minor rally over the next day or two, which traders should use to sell, with a view to repurchasing in the $12 area, where there is strong support bolstered by the proximity of the 50-day moving average.