Well first off, I ill-timed my decision to dump SLV, because I did not buy PSLV right away. Another sign that I flunked Trading Guru 101 in Market Genius school. That said, I’ve got a couple silver miners and a target for silver of 42 in my pocket. So I may yet hop aboard PSLV. Since gold stocks would also benefit from a silver leadership (over gold) situation I am going to look to add to both those and possibly silver stocks after having established base positions.
On to the more important stuff.
First, the daily chart of silver. It appears that the animal spirits that silver is known for are starting to get a move on. One day, perhaps at the target of the Cup, we’ll be hearing the usual “to da moon!” stuff from the bugs that are even more excitable than gold bugs. That is a good long way from the silver price of 33+ in today’s pre-market.
The Silver/Gold ratio has been on watch to make a bottom, which it is still trying to do. If the ratio busts out of this consolidation and takes out its resistance, it’s probably party on Garth, party on Wayne, party on silver bugs, party on gold bugs, and party on commodities, resources and global markets over US markets.
On the matter of commodities/resources, the TSX-V, another of our important guides, furthered its bullish breakout yesterday. The initial target is 680. You may have noticed I’ve been creeping certain ‘.V’ related precious metals juniors (AE.V, ABRA.V, MAI.V, OGN.V) lately. This breakout is among the reasons why. We noted “animal spirits” in silver. Well, junior/exploration mining enthusiasts put those spirits on steroids.
The companion to the cacophony above, as led by silver and the Silver/Gold ratio, would be a breakdown in USD, which took a plunge below its 50 day moving average yesterday and is now banging support in an unpleasant looking pattern.
“America great again” may well be code for “USD weak again”. It’s how modern Keynesian economics and monetary shenanigans work. The ole’ currency devaluation game.
But first things first, while silver is and has been bullish for a while now, the Silver/Gold ratio needs to bust upward and USD break down. Then it’s probably >>>
