CHARTWORKS - Mar 13, 2011
Silver – Signs of an Imminent High

Technical observations of RossClark@shaw.ca

Bob Hoye
Institutional Advisors
Posted Mar 16, 2011

The pieces of the unending puzzle are coming together in the silver advance. Silver made another new weekly high close at $35.83 on Friday. It was the only commodity to do so. The daily ratio of Silver to Gold produced an overbought reading of 80 in the RSI(14); indicative of a price high in silver within three weeks. The weekly chart of Silver produced an upside Exhaustion Alert, common within the last one to five weeks of intermediate rallies. The US Dollar Index has a weekly Sequential Buy Setup, seen around interim lows in the currency and around interim highs in Silver.

The final push to a price high often sees an exponential move that should be used to pare back positions in anticipation of a correction to the 50-week exponential moving average in the following months. A violation of $33 would indicate this rally has concluded.