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« Not Many Shopping Days Left | Main | Silver Wheaton Corporation Call Options Up 105% since November 8th, 2010 »

Silver prices take a break

Silver Chart 09 Dec 2010.JPG

Silver prices closed at $28.33/oz and gold prices closed at $1381.30 as both of these precious metals suffered from a bought of profit taking that sometimes accompanies the big number wobbles. The bears will argue that it is a lot more serious then mere profit taking and that this is a meaningful reversal. However, we do not agree with this stance and remain just as bullish as we ever have been on both gold and silver going higher, with silver prices outperforming gold prices.

A quick look at the above chart of silver prices and we can see that they appear to have undergone a reversal, we think it is down to profit taking, but as always it could be more serious so take care with your trading activities. The gap between the price and the 200dma is also fairly wide which makes us a tad uncomfortable as we have mentioned from time to time. However, as we understand it physical silver is in short supply and hard to come by, so the fundamentals of supply and demand come into play and we believe that they will once again over rule the technical analysis that we derive from the charts. The fizz has been taken out of the RSI as it trades at 58.22, but the MACD and the STO are still high, a week of sideways consolidation would be fine by us.

With regard to the taking of physical delivery we have this snippet from King World News:

Since King World News broke the news with Jim Rickards that a Swiss bank client was refused his $40 million of gold and had to threaten the bank to get it, the story has been going viral.  KWN interviewed James Turk out of London today to get his comments on the situation.  Turk responded by citing another example, “I found that Jim Rickards comments about the individual who had difficulty getting $40 million of gold out of the Swiss bank where he had it stored very interesting.  I could tell you several stories of similar experiences.”

It may only be anecdotal evidence but there are few of these stories knocking around, so once again you just might want to give some consideration to having your metal in your own hands rather than holding a paper receipt from a highly respected custodian.

Over in the options trading pit we had a number of stops triggered, but we walked away with an average gain of 32.7% so we now have 59 winners out of 61 trades, or a 96.72% success rate.

sk chart 19 Nov 2010.JPG

The above progress chart is being updated constantly. However, to see exactly how it is going, please click this link.

So, the question is: Are you going to make the decision to join us today?

Stay on your toes and have a good one.

Got a comment then please add it to this article, all opinions are welcome and very much appreciated by both our readership and the team here.

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Reader Comments (7)

The spot price volatility message from you and the other experts has been hammered home, it makes perfect sense...the other stories about banks and other custodians not wanting to give up physical to its rightful owner I'm sure are just starting really...lots of paper-holders are going to find they're holding worthless cellolose down this uncharted highway...the main reasion why I didn't convert my IRA to physical metal...if multi-millionaires got to threaten their banks, what's the Little Man going to do when push comes to shove? This one isn't going to find out first-hand. I'll hold my own physical thank you very much.

Great job on the options play, wish I had the nerves, brains and time to play that hand.

Best regards...Snakeman

December 9, 2010 | Unregistered Commentersnakeman

I think I could agree with you regarding the preference to hold the metal oneself in the USA, but I somehow doubt that Canadians should be as worried. I have both silver and gold in both Toronto and Montreal. as have many other people. I hope we dont have to worry about 'losing' it.

December 9, 2010 | Unregistered Commenterbobi T.

I think I can understand how an American might have to worry about having the physical metal in his/her possession rather than just a certificate, but I somehow doubt that a Canadian should have the same nervousness. My physical holdings of Gold, Silver, and Platinum are in bank vaults in Toronto and Montreal (very safe and secure I hope), but the cost of delivery and storage here would be prohibative.

December 9, 2010 | Unregistered Commenterbobi T.

1. Weigh the costs of delivery against never seeing it again.

2. Name on Canadian politician that wont stand to attention when America calls.

3. Try getting physical delivery of some of your silver and ascertain what resistance you encounter, it may well be a breeze, if not, a review of where you keep it may be required.

December 11, 2010 | Unregistered CommenterSilver Prices


Thanks for your very kind words, much appreciated by the team here.

Nerves - the key there is to only use a small amount of money so that you can ride the bumps etc, a call option costing $2.00, will cost you $200.00 and you can only lose what you have paid for it and no more.

You could always use our options service, 59 winners out of 61 trades.

However, your method of buying and taking delivery of silver is paying off though, so why change a winning formula, give yourself a pat on the back.

December 11, 2010 | Unregistered CommenterSilver Prices

OH,my god please hit the earthquake on Silver Wheaton Mines and bancrupt the shit. I can't watch this bubble bull shit on SLW. Does SLW makes 20 times more profit than 2 years ago? Is it 20 times better company than 2 years ago?

December 13, 2010 | Unregistered CommenterMike SR

Mike SR,

Well its made us a lot of money.

Up again today about 3.5% so far, what in your opinion is wrong with it?

December 13, 2010 | Unregistered CommenterSilver Prices

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