Have Silver and Gold Hit A Bottom ?

Silver And Gold Could Be Setting Up To Launch

Although silver and gold may require some more time for additional backing and filling, initially it appears as if the precious metals have found some support at the current lows. The slam on silver has been particularly brutal and appears to have been orchestrated with a series of, five to be exact, margin tightenings by the exchanges forcing leveraged speculators and investors to give up their silver due to margin calls.  Sentiment in the two metals are now at a low point and this indicates that most weak holders and traders have sold and are now out of their positions, this is generally a bullish sign. Above is a chart of the SLV which represents silver, it appears to be forming support just below or around the 35 level.

Ireland, Greece, and Portugal continue to pose problems for the ECB and may be the catalyst for a summer rally in both silver and gold. Acting against their own rules, the European Central Bank bought toxic paper from Ireland, Greece, Portugal, etc.,  and a recent publication from a non profit  known as the Open Europe Report makes the case that the ECB could be bordering on insolvency. The ECB continues to use Lehman style accounting tricks to gloss over it’s balance sheet by dressing up low quality assets. The Bullish fundamentals that drove silver to 50 have not changed, you cannot solve debt problems by creating more debt. Currencies around the world will continue to be debased and much of the existing debt will most likely never be paid back.

Like Maria Shriver who put her kids first over her anger towards Arnold, the ECB and Federal Reserve also puts their kids first (the banks and lobbyists) over the interests of  their citizens.  Expect Silver to run up into the 40’s again this summer with a chance at hitting new highs.

 

 

 

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