• 9 hours Why The Gold Rally Flatlined
  • 15 hours The Uranium Sector Can’t Catch A Break
  • 1 day Upcoming Fed Meeting Has Investors On Edge
  • 2 days Global Gold Sector Outlines Responsible Mining Principles
  • 2 days China’s Giant Vampire Fund Loses $120B
  • 3 days McDonalds To Roll Out Robot Drive-Thru Clerks
  • 3 days Savvy Investors Are Betting Big On This Little Data Company
  • 3 days How The Government Is Wasting Tax Money This Year
  • 4 days Supply Concerns Halt Expansion On Tianqi Lithium Plant
  • 4 days The World’s Biggest IPO Is Almost Here
  • 4 days The Relatively Of Money And Happiness
  • 5 days Wall Street Unfazed By Recession Fears
  • 5 days SoftBank Urges WeWork To Pause IPO Plans
  • 5 days Anti-Aging Market To Hit $55 Billion
  • 6 days JPM, Morgan Stanley Take Advisory Roles In Aramco IPO
  • 6 days Are Bonds In A Bubble?
  • 6 days The Unknown Media Giant Taking The World By Storm
  • 7 days From Millennial To Millionaire With One Simple Trick
  • 7 days The 5 Most Expensive Art Pieces Ever Sold
  • 8 days Are Gold Stocks Overbought?
Billionaires Are Pushing Art To New Limits

Billionaires Are Pushing Art To New Limits

Welcome to Art Basel: The…

Zombie Foreclosures On The Rise In The U.S.

Zombie Foreclosures On The Rise In The U.S.

During the quarter there were…

The Problem With Modern Monetary Theory

The Problem With Modern Monetary Theory

Modern monetary theory has been…

  1. Home
  2. Markets
  3. Other

Silver Market Update

Originally published April 16th, 2016 in the Various Reports Sector.

The combination of silver having arrived at a short-term target, with bearish looking candlesticks appearing, gold completing a Head-and-Shoulders top and latest COTs for both gold and silver being at the sort of extreme readings characteristic of a top, all point to silver reversing to the downside here.

On its 6-month chart we can see how silver's sharp advance over the past week or so has brought it up to a trend channel target, where the advance has run into trouble, with bearish looking candlesticks in recent days suggesting that it will soon drop away again.

Silver 6-Month Chart

Silver actually looks quite promising on its 6-year chart, as it appears to be on the point of breaking out of its long-term downtrend. However, this is belied by the various factors mentioned above and by the slow stochastic shown on this chart, which is at an extreme reading only attained twice in the past 4 years, and both those occasions were tops. So it looks set to slump back into its downtrend.

Silver 6-Year Chart

After easing last week, related to silver dropping back to the lower boundary of its channel shown on its 6-month chart, Commercial short and Large Spec long positions ramped up again this week close to recent very high readings due to silver advancing sharply back to the top of its channel. Like gold, these readings are construed as meaning that silver is probably at a top here.

Silver CoT

The silver Hedger's chart, which is a form of COT chart, goes back much further, and reveals that readings are at their most extreme since 2008, after which silver plunged in tandem with the broad market crash - and there are signs that the broad stockmarket may be on the verge of another severe decline, which is something we will look at in detail in a separate report. This chart is viewed as providing a serious warning, which the majority will ignore, of course.

Silver Hedgers Position
Chart courtesy of www.sentimentrader.com

Conclusion: despite PM stocks enjoying a mean reversion rally on the back of recent dollar weakness, silver has been a "damp squib" so far this year, hardly rallying at all, and instead of playing catchup as many are anticipating, it looks set to slump back into its downtrend as gold and the stockmarket fall, and the dollar rallies.

 

Back to homepage

Leave a comment

Leave a comment