Silver Prices at a Thirty Year High

Print This Post | Topic: Silver Mining Companies, Silver — January 4th, 2011

Not an ‘all time’ high just yet but silver prices have moved at a blistering pace since August 2010 as the above chart clearly depicts. We have to say that we are relieved to see silver punch through the $30.00/oz level as we have been banging the drum for silver for some time.

You may recall that we re-vamped our strategy in August 2010 and reduced our exposure to some of the gold miners and indeed a few of the silver miners in order to acquire more of Silver Wheaton’s stock, (SLW) which we are now pleased to have done as it has been kind to us.

However, the mining sector is warming up and the progress made by a number of silver producers such as Endeavour Silver Corporation, (EXK) now standing at $7.37 and First Majestic Silver Corporation, (FR) which is now standing at $14.40 has been admirable. Should the precious metals sector maintain its trek north then the profits generated by these companies will render them irresistible to investors especially when comparisons are made with other market sectors.

Back to the chart for a moment, the gap between the 200dma and the price of silver still gives us cause for concern which we feel we ought to mention as a negative consideration. However, as we all know, this is such a tiny market that any signs of the general public taking an interest and the pressure would surely mount to jaw dropping levels. The fundamentals are in the driving seat at the moment and lets hope that it stays that way, with the technical indicators taking a back seat for now.

On the positive side we can see that there has been a crossover by the MACD which we view as a positive sign for silver prices.

So, nice to be back and we hope that you and yours had a good one, but its over now so brace yourselves for a year of enormous change, volatility and wild price swings as the Bulls and the Bears up the anti.