Silver closed up 30 cents today. Open-12.18 Close-12.48 High-12.58 Low-11.94
Silver had an impressive rally today, reversing last nights falling prices into a thirty cent gain on the day. It also made a new 2-month high at 12.58 which is the highest price since May 31st.
Although the precious metals were able to make impressive gains today, it was in the face of declines in the stock market and a flat oil market. I am a little bit confused about why today's action was so strong.
Reasons for being wary of this silver bull
1)Falling stock prices
2)Stalling energy prices
3)XAU(which is usually a leading indicator) has stalled below it's July high
4)Silver lease rates are down
5)Silver inventories are not being drawn down any further than 100 million ounces
Any reversal in these categories would be viewed by me as a bullish development.
I am confused by the strength of today's move and I respect the price chart more than any of my fundamental ideas-so I would recommend being flat the market right now. If you are short, use a stop around $13. If you are long, I would sell immediately or use a stop around 11.90.
Good trades and may you see a silver lining,
Matt
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