Ten days ago, we posted an article predicting that “Silver Prices Poised To Leap At Least 50 Cents”. At the time silver was trading for $12.47, but yesterday silver made a high of $13.09 so we got a 62 cent move on silver after our BUY signal.

Our primary reason for calling a short term BUY on silver for a 50+ cent move was that silver was technically very oversold. The RSI, STO and other indicators were on the floor and silver was a fair way below its 200dma. If one looks at trading patterns in silver over the last few years, one notices that although silver prices do occasionally fall below the 200dma, such drops are nearly always short lived and so we thought it was worth a bet on silver prices rising more than 50 cents in the short term, to get back up to the 200dma.

To any of our readers who managed to capitalise on this move then well done!

At the moment we are still very bullish on silver prices in the long term and bullish on all our silver stocks. Short term, one should be watching the 200dma and the 50dma very carefully. These two lines are on a collision course where one of two things can happen. The 50dma can break the 200dma – which would send out a very negative signal. Alternatively, the 50dma could bounce on the 200dma and send silver prices on a bit of a rally.

As yet, we are unsure which way the chart is going to turn, but any downward movement will be short lived as we maintain our prediction that a rally in silver and other precious metals is due at the end of the summer. We shall continue to keep our readership informed on the latest happenings in the silver market and in addition to this we will keep you posted on any short term trading opportunities that present themselves.