• 518 days Will The ECB Continue To Hike Rates?
  • 519 days Forbes: Aramco Remains Largest Company In The Middle East
  • 520 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 920 days Could Crypto Overtake Traditional Investment?
  • 925 days Americans Still Quitting Jobs At Record Pace
  • 927 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 930 days Is The Dollar Too Strong?
  • 930 days Big Tech Disappoints Investors on Earnings Calls
  • 931 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 933 days China Is Quietly Trying To Distance Itself From Russia
  • 933 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 937 days Crypto Investors Won Big In 2021
  • 937 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 938 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 940 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 941 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 944 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 945 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 945 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 947 days Are NFTs About To Take Over Gaming?
What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

  1. Home
  2. Markets
  3. Other

Silver Bottoms Amid Subtle But Bullish Factors

Successful market timing is based on careful use of technical analysis and sentiment analysis. Technical analysis measures supply and demand and sentiment analysis takes that a step further by looking at investor attitudes their positions and money flows. This information helps us assess probabilities. Nothing is certain but we want to see strong evidence before forecasting a turn in the market. In regards to Silver, we see strong evidence that a bottom is in place and the market will move higher in both the short and intermediate term.

Below is a chart from timingcharts.com which shows Silver, the commercial short position in Silver and open interest. After Tuesday it appears the market has put in a bottom (based on daily closing prices) at $33. More importantly, the commercial short position is at its lowest level since April 2009. Open interest is 29% off its high and at more than a one-year low. This tells us that the market is presently devoid of speculation.

Silver Continuous Contract

Meanwhile, as of the end of last week, public opinion (from Sentimentrader.com) in Silver was only 32% bulls. That is a three-year low.

Silver Sentiment 2007-2011

It has been said the stocks should lead the commodity at key turning points. Several months back we were harping on the relative weakness in silver stocks. Now that has completely reversed. The silver stocks have been leading the metal for the past two weeks. In fact, our junior index closed at its highest level since June 1. Silver would have to close above $38 to reach its highest close since June 1.

JR Silver Index

As Silver hit $50/oz, we wrote a piece titled Downside Targets for Silver. We concluded with: "...wouldn't you rather increase your positions in the $30s rather than at $45 or $50?" Well, now is your chance. Back then, public opinion was over 90% bulls and Silver was in a parabolic state. Today, we see that Silver has advanced to $35 after failing to close below $33 over the past two months. Furthermore, sentiment analysis is as supportive for Silver as any time in the past few years. Finally, the stocks, which tend to lead at key turning points have closed at a five-week high.

We don't make predictions, we only assess probabilities based on our evidence. The evidence is compelling that the silver complex has put in a bottom. We believed so two weeks ago and that is why we increased positions in our premium service.

Good Luck!

 


If you are looking for more analysis and professional guidance, then we invite you to learn about our premium service.

 

Back to homepage

Leave a comment

Leave a comment