Thursday, September 01, 2005


Silver's price over the last couple of weeks or so has broken down below its long term bull market uptrend as well as down through its upward sloping bottom to its big triangular flag formation that started in the early part of 2004.

Myself, I'm taking this as "chart painting" by the cartel (bullion and money center banks/US Treasury/Fed). I believe silver scares the cartel more than gold does since its potential to explode to the upside is so great since over decades the above ground supply of silver has declined a huge amount relative to increasing usage. Silver's deficit keeps on increasing. On top of that, silver is a strategic metal where as gold is not. If silver were to explode, that would put a lot of upward pressure on gold. If gold explodes, people who currently have their heads buried in the sand over inflation will no longer be able to say/believe that inflation is not a problem.

Silver's MACD and momentum are still negative, but they could be turning up real soon. Silver's MACD is no lower than its previous MACD low of early July despite the silver price being lower. This is bullish. On top of that silver was down 6 days in a row when the markets closed on Tuesday. Bullish. It didn't form a "hammer" that day, but it came close to one.

Some of the silver stocks traded strong all day long yesterday, moving up in the last 30 minutes of trading. I suspect something is up with silver. That it has put in an important bottom. I hope I'm not wrong. We'll see.

On the down side, I don't know, but word is that Warren Buffet has legal difficulties with one of his companies and has been pressured to sell from his big silver holdings to stay out of hot water with the government. We'll see.

"I think the subject which will be of most importance politically is Mass Psychology... Its importance has been enormously increased by the growth of modern methods of propaganda... Although this science will be diligently studied, it will be rigidly confined to the governing class. The populace will not be allowed to know how its convictions were generated." ---Bertrand Russell

1 comment:

Anonymous said...


great russell quote!

good post, too!