Thursday, April 20, 2006


Here is a 15 minute bar chart showing pit and electronic trading in May silver futures.

Among all the markets I follow silver has had the look of a very unstable one, principally because of its nearly vertical rally from 900 to 1468 over the past two months.

I think that a big break in silver has started today. Ultimately it will probably carry the market back to where the vertical rally began. This is the 921 level which is the 2 5/8 multiple of the 1991 low at 351.

From today's low so far at 1220 silver will probably stage a three phase rally to 1310 or so. After that a drop to 1172 is likely before a more substantial rally can start.

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