Clive Maund: Silver Market Update

The diminution in silver's downside momentum and the massive contradiction between our earlier bearish interpretation of the charts, and the strongly bullish COTs and sentiment indicators forces us today to reconsider the charts and ponder other possibilities, for we cannot afford to be on the wrong side of the trade in this commodity. Fortunately we are still ahead of the curve as silver has yet to "tip its hand", but it doesn't look like it will be long now before it does.

So today we are going to consider two wildly different scenarios, the bearish one detailed in the last update, which may yet come to pass if deflation gains the upper hand, and the bullish one which will take hold if Europe is saved shortly and we get back to "business as usual", i.e. building the debt and derivative mountains to ever greater heights. Right now everything is hanging in the balance - it could tip either way, but as we will shortly see it would appear that Smart Money is betting on the return to business as usual, and as they make money, by definition, we are perfectly happy doing what they do, if we can figure it out, that is.

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