March 10th, 2011

Hey everyone, silver is at it again. Over the past few days, we have seen silver almost hit $37 and not it has pulled back to around $35. With news that JP Morgan issuing 6,000 new contracts in paper silver, its not surprising that a pullback is occurring. Link to an article explaining that is here. Lets see what the charts are telling us.

 

For one, the vital $34.40 support is still intact. Using the fib. sequence, connecting the support with the top, shows us that there is a downtrend move. We see that the price jumped around the 38.2% line and then broke the line to fall to the 61.8% line. A move below this once again signaled a downward movement. Now currently we see it trading right at this marker. If silver can get about the 50% line, I think we will see a push upward once again. 

There was a downward triangle which was an indicator of a falling price, which is exactly what silver did.

Now I think this is the most important chart. Going all the way back to when silver was around $30. The current price is still inside the upward channel. If the price breaks the support line then expect a downward price movement. However I think we all know which way silver will end up moving.
By looking at this chart, I think now is a good time to be buying. In my opinion, this is a dip in the price. I think in the next few days, we will see the price make a movement back up to the resistance line.
Thanks guys and have a good day.
<---Great book btw.

**All of my advice is just that...Advice. Before you make a financial decision, make sure to ask your financial adviser.