Will silver go to 29 or 26 USD on the spot market ?
It is the end of June 2012 and it is Saturday and all silver trading is on the backburners for the weekend. The last trading day of June 2012 set silver at a price of 27.5.
Here's my chart of silver - XAGUSD - with some trendlines that were drawn in. Most trendlines are very bearish for silver on this chart.
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| Silver 29 to 26 ? That is the question... |
June 2012 was a wicked month in silver trading. In the first week of June 2012 we saw a spike to nearly 30 USD. The energy that fueled that spike faded quickly and the XAGUSD quote retraced quickly to 29 and ranged above the May 2012 29 to 28.5 range.
Silver bull sentiment faded away with the Bernanke news releases and the price of silver quickly drepped from 29 to 26.
It wasn't until the last few days of the month and some news releases coming out of the EU ssummit meetings claiming that the EU banks would be recapitalized that silver traders found enough courage to buy the white metal up to 28 ( in the blink of an eye ). The bottom line for June 2012 silver spot was 27.5 XAGUSD.
What's next ? 29 or 26 ?
A person could make arguments for both sides. Silver short term ranges always offer several percentatges of volatility. This next month could as easily be a series of short waves fluctuating between 26 and 29 as it could be an early July 2012 bull run to test 29 then an aggressive bull move to challenge 30 which would somehow indicate a longer term trend reversal for technical traders.
At the beginning of May 2012 XAGUSD broke below 30 USD and no one, except silver bullion buyers has dared to pay more than 30 dollars for an ounce of silver since.
So where to ? 29 or 26 ?
Most physical silver buyers who are looking to buy on the cheap and hold on to their silver are likely hoping for the silver spot price to fall well below 26 at which point they could accumulate more physical silver.
That is the long game. What about the people who dare to trade silver spot market contracts either long or short ? That is the silver paper game which most physical silver traders do not bother with.
The paper silver game is the arena of the silver market manipulators. Or at least that is the general feeling amongst those who research and follow the silver trading trail.
The biggest question of this particular " Silver News Blog " is " Can one play both the physical silver buy and hold game and the paper silver trading game at the same time.
Buying silver bullion is a no brainer in a world that is on the brink of madness if not completely mad already.
Silver bullion, if nothing else, will serve well in a blackmarket society or when paper money is become worthless.
Until then however, the money masters, ie., big players like JP Morgan Chase Co and others will continue to defend their short positions and by doing so there will likely continue to be plenty of these multi percentage overnight spikes in silver.
Can the average Joe buy and sell silver spot contracts and challenge ranges like the one that might settle between 29 to 26 ?
That is the question ?
How much do I buy ? How much do I sell ? How do I justify being long and short at the same time ?
Those are other questions.
