The silver markets had a very strong showing during the course of the
week, breaking above the $20.50 level. In fact, Thursday was a source of
most of the gains, and it now looks like we are heading towards the $22
handle. It’s at that area that we would expect see a bit of resistance,
but if we can get above there we think that the market is probably
going to head to the $25 level given enough time.
If we do pullback from here, we feel that the market will more than likely find plenty of support below, so it’s almost impossible to short it at this point in time. Besides, there isn’t much in the way of room at this point time from a longer-term perspective as the area just below the $19 level has been so supportive. We need to break down significantly below that level in order to get very bearish, so with that being the case we feel that this is essentially at this point in time a “buy only” type of market.
If we do pullback from here, we feel that the market will more than likely find plenty of support below, so it’s almost impossible to short it at this point in time. Besides, there isn’t much in the way of room at this point time from a longer-term perspective as the area just below the $19 level has been so supportive. We need to break down significantly below that level in order to get very bearish, so with that being the case we feel that this is essentially at this point in time a “buy only” type of market.
Keep in mind that silver also has an industrial component to it, as it
is used as a base metal from time to time in applications for industry.
Because of that, it also is not only an anti-dollar play, but it is also
reflective on economic conditions.
