As usual, idiot Clive decided to stay away from the market analysis for the last few weeks to "focus on his PAID subscriber" and only write for that one person who paid him - Dennis Gartman (i mean where else does he get his shXt from? But the horses couldnt remain chained, opportunistically he decided to write a duo, on the gold and silver market and issue them to the public.....oh well, the guy can't even get his one hit wonder missives right....silver is about to take off, while he writes how it's about to break alllllll the way to mid 20's.....Clive, take the opportunity and crawl back to your paid subscriber.

Silver Market

Update

originally published March 5th, 2012

• Silver Market Update
  March 5th, 2012
• MARKETWATCH - the plunge - what does it portend?...
  March 1st, 2012
• MARKETWATCH - another PM sector upleg brewing?...
  February 15th, 2012

Silver has had a good run from its lows at the end of last year and was on course to break out of the major downtrend in force from its highs of April last year, but it was not to be, for last week it reversed sharply to the downside, leaving behind a bearish engulfing pattern on its chart, as we can see on its 15-month chart below. While it has not yet broken down from the intermediate uptrend in force from late last year, action last week suggests that it is destined to shortly.

The fact that silver tried to break out of its major downtrend channel, but failed and then dropped hard on heavy volume is a clear sign of a trend change - an intermediate reversal. Thus it is now expected to break down from its shorter-term uptrend shown and drop away, despite the fact that it is not very overbought and its moving averages are in increasingly bullish alignment. How far could it drop? - it could drop right back across the trend channel which would clearly not be good news for silver bulls, and there is nothing to say that it could not drop further than that.

The 3-year chart for silver shows the current established downtrend in the context of the preceding strong uptrend. While it now looks set to drop back across the channel, a clear upside break out of this obviously important downtrend will restore upside potential.