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Summer turnaround candidates among the silver minesClif Droke
SSR snippet
The daily chart of the silver spot index shown below tells the story.
Not much has changed since our last look at the white metal. In last month's newsletter we pointed out that the lateral trading range for silver continues, with near-term pivotal support at the $6.75-$6.80 area with the "ceiling" at approximately $7.60. This ceiling was tested in early June as our anticipated silver minor rally materialized. What does the above daily chart show us? That the 30/60/90-day dominant short-term moving averages are currently out of synch. The 30-day MA (yellow line) needs to be on top with the 60-day MA (blue line) in the middle and the 90-day MA (red line) on bottom. This de-synchronization suggests that the lateral trading range will continue for at least a few more weeks before silver can consolidate and absorb enough supply to force another test of $7.60 and a breakout attempt. The internal indicators for silver also suggest that more lateral consolidation is needed before the next breakout attempt. For instance, in the above daily chart of silver, the slow stochastics indicator (bottom indicator strip) has again reached an "overbought" reading commensurate with previous near-term peaks. Notice that whenever the stochastics in silver hits the 100 level or nearly so a pullback follows. We'll need to continue to watch the $7.60 area pivotal trading range resistance as we head into July. The dominant interim equities cycle is due to bottom at that time, which may have a spill-over influence in the silver mining shares. So we'll need to be on our toes between now and the early part of July, paying special attention to pivotal support levels mentioned in the stock section below. For spot silver, the $6.75-$6.80 remains the dominant near-term trading range floor/support. The real story for the months immediately ahead in the silver mining sector are the potential summer turnaround candidates mentioned in the stock section below. Such potential turnarounds are becoming more numerous and show promise for later in the season after the current overhead supply has been fully absorbed... Lots more follows for subscribers. You can subscribe here, --Clif Droke
321gold Inc |
