Silver Sell-off Begins!

April 20, 2006

Timothy Silvers

            This is a quick update with my latest thoughts on the silver market. I have been expecting a large drop in the price of silver for the past few months, but the bull market has been stronger than I anticipated with a lot of speculators jumping in during March and April. Buyers stepped in whenever the price looked like it would have a good correction. Yesterday, silver reached hugely overbought levels and closed at a spot price of $14.54. Today we witnessed a $2.13 sell-off in silver that appears to be continuing in the aftermarket and overseas trading. I think this correction still has a few dollars to go.

            I expect further downside tomorrow and would not be surprised to see silver test the 50 day moving average at $10.75. After that, my best projection is that we’ll find support around the 200 day moving average, which is at $8.58 right now. In April 2004 and December 2004 silver found support near the 200 day moving average after both corrections. This market is very volatile and making any projections is difficult. I will be watching the market closely and posting another article when I think we have bottomed out. That should be one to three weeks away. I believe that may be the last opportunity we have to buy inexpensive silver. Get your cash ready!

 

God Bless,

Timothy Silvers

 

Disclaimer: This article represents the opinions and personal views of Timothy Silvers and is not intended to be investment advice. If you choose to use this analysis for your personal trading, Timothy Silvers assumes no liability for the direct or indirect losses you may incur due to using this article to make your investment decisions. You are totally and completely responsible for your own investments. At any given time, Timothy Silvers or his friends and relatives may have positions in silver related investments that may or may not follow the recommendations contained in this article. The information in this article may not be completely correct and accurate. Even though Timothy Silvers has done his best to review the content and accuracy of this article, he is in no way liable or responsible for any mistakes or omissions.