What's silver Up To?

[richiedoc]

http://www.omencity.com/silver/silver_volume_daily_10-13.JPG

http://www.omencity.com/silver/silver_10-13_hourly_volume.JPG

I smell a takeout or a breakout. Someone get me Ted Butler on the horn![/url]

[richiedoc]

I smell an uptrend. Prediction? By the time the Comex opens tomorrow morning the traders will be falling over themselves to buy in at over $12.

IMO of course.

[Ardent Listener]

Down to $11.61 as I write this. Still my gut tells me we are going to see at least a mini bull run in the near future.

[oroborean]

Anyone who does not understand the movement in silver this week either has not read or does not understand my thread about the Fed and the election cycle. Selling in the bond market and a rally in the equities, supported by underlying economic data, has shored up the view that there will not be a rate-cut at least through january. The slightly higher inflation numbers on Tuesday confirmed the consensus that, if anything, the Fed is presently still leaning towards a hike (though the Fed thread entertains the idea that this is merely a stance because that the FOMC must look credible as an inflation fighter even if it would rather cut). Less liquidity at this point in the cycle would hurt commodities, and so they were taken down on Tuesday. On Wednesday, reality sets in and PPI growth actually seems to be moderating and, with lower oil prices (high inventories this week) and gold still off the high, inflation does actually appear contained. Under this outlook, the Fed can stand pat and so the selloff on Tuesday was probably premature.

While there are certainly silver investors buying and selling on the fundamentals, the large money that moves the price on a day to day basis is working off the macro view. The outperformance of oil is an excellent indicator of fundamental strength in silver, though is an even stronger indicator of high petroleum inventories and a temporary cessation of terrorist and geopolitical turmoil. If ever there are times when the emperor wears no clothes and the entire world must clearly dance naked to the song of the hidden leaders, this is one such as those.


UPDATE (10/20): Yesterday's big move up in silver was a result of a change in the macro-economic picture, but not Fed rate-expectations. This time it was a .75% drop in the USD, which naturally sent commodities prices higher. The Fed, however, proving itself ever more and more efficient, released monetary supply numbers later that day that indicated a decrease in liquidity. This, coupled with the Philly jobs number, has worked to reign in oil, gold and silver in today's trading on lowerered inflation expectations and no sign of a rate-cut.

[Whatsamobo]

So I have been watching the price all week and after selling 550 ouces at 11.60 hoping to buy back more for less (had my chance at 11.40) and have since seen nothing but up all week. But it has been small moves each day. I am just going by price movement, but is there a tug of war going on between the longs and shorts? The shorts are trying to hold the price down, but the mass of longs (old and new) just slightly win out? Or am I not seeing the a bigger picture based on the dollar, oil and inflation and we are just in an uptrend that will correct some time in the near future?

[oroborean]

Everyone's specific investment needs are unique, but for my take on the current silver market in general, you can read my weekly update here (http://www.safehaven.com/article-6230.htm).

[Ardent Listener]

Everyone's specific investment needs are unique, but for my take on the current silver market in general, you can read my weekly update here (http://www.safehaven.com/article-6230.htm).

Thank you for the link. I'll share it with others. Any insights you have into the base metals marketwould be most welcome.