Will Silver’s Quintuple Bottom Hold ?

The silver market is showing several multi-year (even multi-decade) extremes. That indicates a big move is underway.

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Since its peak in 2011, silver lost approximately 70% of its value. Since last November, silver has formed a support area on its chart right below $16.00 per oz. That structural trendline is being tested right now, as seen on the next chart (red horizontal line). We really are at a pivotal point.

silver_daily_16_June_2015

Note how this is the 5th time since last November that the trendline is being tested. That is of huge significance. Chart-wise, a double bottom is important, so imagine what a “quintuple bottom” means.

The Commitment of Traders report for COMEX silver futures positions at the close of trading on Tuesday June 9th showed that 18,028 short contracts were covered by commercial traders, which is one of the largest changes in COMEX history. Three weeks before, the number of short contracts added by commercial traders were 19,706 which makes for another historic change.

The open interest currently stands at 189,524 contracts, the highest in history. Clearly, something is up in the silver market.

The rate of change in short positions by commercial traders, one of the key indicators we are monitoring, has moved aggressively from bearish to bullish in a matter of 3 weeks. It indicates there is a lot of tension in the silver market, and the breakout or breakdown is going to be explosive.

cot_silver_12_June_2015

Given the large open interest in COMEX silver, a “false breakout” would invalidate that view. The pivot price is $16.50. Any sustained move above or below that price will determine the next cycle.

It is almost impossible to predict in which direction it will go. What we do know, however, is that it will be explosive.

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  • RUSS

    Hi!, Patrons Of Gold And Silver Worlds Et. Al.:
    Silver, the industrial, monetary metal, will probably outshine gold in my opinion; whenever the precious metals sector rises again. Nobody can know the exact bottom of any market, until their view is clear according to hindsight. Some commentators are recommending we buy precious metals ASAP, because when the precious metals awaken again and head higher, there is a high priority that supplies could be quickly exhausted meaning we can’t buy from an exhausted inventory putting all our intentions to buy on the sidelines of frustration. Right now the word is out that the price of silver for example is below the average costs of production meaning silvers’ price is exceptionally low. My past experiences with silver have shown me that its’ price can move $2 in a matter of minutes in either direction; so be careful buying futures on leverage but instead prefer buying physical silver you possess avoiding margin calls etc. For use in the electronics industries worldwide, one troy oz. of industrial, 999 fine, silver can be drawn into a fine wire that sends electrons from point A to point B etc. that is 50 miles long which makes silvers potential price a lot higher than todays’ price don’t you agree dear reader? Each of us must do our own due diligence before we make such choices with which we will live until we decide to either sell or move on.
    RUSS SMITH, CA. (One Of Our Broke, Fiat Money Corrupt States)
    resmith1942@gmail.com