Subscribe for 12 months with recurring billing - $199

Buy 12 months of subscription time - $199

 

Search Silver Prices
Silver Price
[Most Recent Quotes from www.kitco.com] Our RSS Feed

Silver Updates by Mail

Enter your email address:

Follow Us on Twitter
« Silver Prices Fall: Hard and Fast | Main | Silver: A Technical Breakout Could Be Weeks Away »
Thursday
Aug162007

Silver Stocks: Buying Opportunity Ahead

As we said two days ago, we are of the opinion that a technical breakout in silver prices could be just weeks away.

SLW Silver Stocks: Buying Opportunity Ahead

However we may be getting close to the bottom in silver stocks as they all took a hammering in yesterdays trading. Silver Wheaton in the chart above lost 7.9% whilst Silver Standard was down 9.27& and Endeavour Silver lost a massive 15.94%.

Many may expect our sentiment to be one of crying our eyes out after taking such a loss yesterday. On the contrary, the mood in the office is upbeat as everyone realises what a great buying opportunity may be around the corner. This opportunity could be used to add to existing holding in silver stocks, purchase an initial position or just buy for a short term trade and a quick profit.

It is long held belief that Silver Wheaton is one of the best silver stocks on the market at the moment. We have been watching SLW closely lately as the story for this stock over the past few months has been an exciting one. As readers of The Silver Prices Newsletter will be aware, we saw an ascending triangle formation and warned that a breakout of this triangle (AcTri on the chart) would result in a large rally. Silver Wheaton then broke out of the triangle and went on a terrific run. We though Silver Wheaton was getting a little overbought so we signalled to our readers to take some profits at around $13.65. Silver Wheaton continued to rise to near $15.00 and so this made our remaining shares look good in our portfolio but at the same time we have locked in significant profits as we thought a drop was due. When Silver Wheaton began to fall, we though that $12.50 would be an reasonable level for the stock to drop to but when we saw the Head and Shoulder formation, we believed it would fall further. Silver Wheaton has fallen further to $11.77 and so now is a good time to buy this stock along with other silver stocks. However, Silver Wheaton could fall a fair bit further, perhaps to its 200 day moving average before it finds a bottom, unless it finds some support at the $12.00 level. Therefore we will be patient and wait for a reversal or some signs of consolidation before buying back the shares we sold at around $13.65.

Endevour was hit the worst out of all our silver stocks yesterday as it plunged nearly 16%.

EXK Silver Stocks: Buying Opportunity Ahead

Endeavour has been performing well for us and so we are keeping this stock in our silver portfolio. We are slightly concerned that it has breached the 200 dma but we will be keeping an eye on this stock over the next few days to look for an entry point to increase our position or run a short term trade. Even though the RSI is looking bullish in the buy zone, we would prefer to see some consolidation in this silver stock before signalling an additional BUY.

Silver Standard had been bucking the trend recently, rising whilst other silver stock were posting losses. Over time, Silver Standard has been one of our best performing stocks in this sector after we first starting buying over a year ago below $20.00.

SSRI Silver Stocks: Buying Opportunity Ahead

What is interesting here is that Silver Standard has broken its 200 day moving average, an event that has become somewhat of a rarity in this stock. The last time Silver Standard broke its 200dma was in October of last year. In fact in the last 2 years it has only broke down 3 times, each breakdown being very short lived. This suggests that this drop will also be short lived and we should see a sharp rebound soon. We will watch for the moment to ensure the drop is over and then we will consider signalling a BUY.

The next few days could be very interesting indeed as we may witness the last bottom in silver stocks before the next large rally that we see beginning some time toward the end of the summer. By subscribing to our FREE Silver Prices Newsletter you can stay updated on silver and silver stocks during this exciting time.

PrintView Printer Friendly Version

EmailEmail Article to Friend

Reader Comments

There are no comments for this journal entry. To create a new comment, use the form below.

PostPost a New Comment

Enter your information below to add a new comment.

My response is on my own website »
Author Email (optional):
Author URL (optional):
Post:
 
Some HTML allowed: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <code> <em> <i> <strike> <strong>