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CHARTWORKS - Mar 6, 2011
Silver – No Signs of Exhaustion

Technical observations of

Bob Hoye
Institutional Advisors
Posted Mar 8, 2011

Silver continues to match the action seen in previous bull markets. There are eight examples since 1976 that saw both gold and silver in solid uptrends, where silver was leading coming out of consolidations similar to December-January. This phase of the bull market (from the low close on January 25th and intraday low of $26.38 on January 28th) should take no less than 45 trading days, unless the RSI(14) pushes into the high 90’s as seen in January 1980. The time window for the next interim high is estimated to be the end of March through the first week in April.

In most instances our Summation and Exhaustion Indices produced daily Upside Exhaustion alerts in the final few days of the rallies. In all, but one, there were weekly Exhaustion alerts. None are present at this time, but weekly signals could appear as early as next week. It is not unusual to experience as series of weekly signals before the daily ones appear and put a cap on the price.

The $40 to $43 target, based upon the mild January correction, related to the rally from August appears quite reasonable based upon the weekly chart below. The upper resistance line is at $45. The minor resistance line at $33 was surpassed last week. In the final stages of the bull markets ending in 1974 and 1980 the price exceeded the resistance lines on the semi-log charts after which they became important supports.

(Click on images to enlarge)


Mar 6, 2011
Institutional Advisors

Hoye Archives

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