Friday, February 5, 2010


It has been bad days for silver recently.  Looking at the daily chart, a head-and-shoulder pattern has been formed.  This pattern has been confirmed by yesterday's price action.  The price has gone below its 200d MA and invalidates the assumptions that it is in a consolidation phase.

Based on the projection of the neck line, it is expected to see the price to go down from $16 plus to $13 thereabouts.  This coincides well with the support level that we observe from the chart.  If $13 breaks, next level is $12 thereabout.  It is less likely it will break $12. 

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